How to Bring Gold Back to the US

I have liked the idea of having some precious metals outside of the country and made the move to do it many years ago.

But what about bringing gold (or its value) back into the US? What is the best way? I have owned gold in a living trust and it is stored in a vault in [location redacted].

What if I want to bring it back some day into the US to distribute it to the beneficiaries of the trust (my children for instance) or bring it back into the US to purchase another asset in the US (real estate for instance).

Any thoughts?

*I changed a few things for flow and to preserve privacy.

It’s a good question and one people tend not to associate too much with our practice. We’re more well known for helping clients diversify assets internationally, not bring them back.

But as I covered in my piece about Easiest (and Hardest) International Investments to Inherit, a responsible planning firm must be available to help repatriate those assets when the time comes.

Most of the time, when the time comes, we’re working with the heirs.

But sometimes clients want to simplify things as they get on in years. And sometimes that means pulling back a chunk – or sometimes even all – of their international assets back to the US.

So, how should you approach such a task?

Well, here are a few of the key questions we ask when reviewing a request like this.

What form is the metal?

Different tax regimes will apply depending on whether the metals are in physical (i.e. allocated) or non-physical (i.e. unallocated) form.

How is it held?

Retirement accounts holding precious metals don’t trigger a tax bill when selling. Most other holding options – including a living trust – do.

How long has it been held?

If the metals are held for less than a year, they will generally be taxed as a short-term gain at ordinary rates. If held for more than a year, either collectible (for allocated) or long-term capital gain rates (for unallocated) will apply.

How large is the gain?

This is probably the biggest question – the larger the gain, the larger the tax hit.

What income tax bracket will apply?

The first few questions were about establishing the type of tax that will apply. But depending on your income, the applicable income tax bracket determines how high the tax bill actually is.

What’s the shipping cost?

If you have a large gain and know there’s a large tax bill if you were to sell, we would want to look at the cost of shipping the metals back to the US.

This is highly specialized work and the logistics companies that handle such things will not usually work with consumers. You’ll have to work with a firm like ours, a gold dealer, or a vault directly to even get a quote.

How do you plan to use the proceeds?

If you plan to keep it in metals and there’s a large gain, shipping the metals over and holding them in the US may be a better option. When you pass, the cost basis of the metals will be updated to the market value at the time you head to that big ol’ fishing lake in the sky, which allows your heirs to sell then without triggering any federal capital gains tax at all.*

(*Subject to estate tax considerations of course; your state of residence may apply their own rules.)

On the other hand, if you’re interested in reinvesting in another asset class, like real estate, you really have two options:

• Sell the holdings where they are now, repatriate the funds, pay that tax to Uncle Sam, and reinvest the proceeds.

• Keep the holdings, borrow against them, invest in the other asset class, and use the returns from the new asset to service the loan.

There’s really no right or wrong answer here. And that’s why there’s no such thing as a single “best” answer.

Each option has different advantages and disadvantages. One locks in a tax bill permanently; the other is somewhat more complex and exposes you to interest-rate risk.

After reviewing the facts, only Xavier can decide what’s best for him.

Do you have international assets and are thinking about either selling or bringing them back to the US? Feel free to get in touch to see how we can make the process a lot smoother for you.