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In 2022, Alabama extended its sales tax exemptions on precious metal bullion, relieving some of the tax burdens on investors, and taking a step toward treating gold and silver as money instead of as commodities.
The Federal Capital Gains Tax applies in Alabama. This is set at a maximum of 28%, but the actual amount changes from person to person and is based on income and other factors. This tax is applied to all profits you make from the sale of precious metals. Under current law, gold and silver are subject to capital gains taxation when exchanged for Federal Reserve notes or when used in barter transactions. If you buy and hold, no taxes are due.
Alabama removed sales taxes from most gold, silver, platinum, and palladium coins and bars. A new law also lowered the level of precious metal content necessary to qualify as “bullion” under the law from 90% to 80%.
Source: http://revenue.alabama.gov/salestax/Rules/810-6-2-.27.pdf
Alabama was built on agriculture, and has thrived in the last 60 years or so, prior to which it was one of the poorest states in the nation. Its largest city is Birmingham and the state capital is Montgomery. The Yellowhammer State is seen as a great place to buy gold and other precious metals, which comes from the fact that it has always had a close connection with mankind’s most prized precious metal. However, sizeable taxes on precious metals go some way to countering this.
Alabama has a history rich in gold. There have been gold mines here for over 150 years, with prospecting, mining, panning and refining throughout that time, supplying investors and mints throughout the country. Alabama suffered through difficult times during and after the American Civil War, as did many other southern states. However, it owes thanks in no small part to the gold industry for being able to overcome those hardships and become a prosperous state. Today Alabama has large aerospace and manufacturing industries, producing everything from steel to minerals and livestock, all of which contribute to a GDP of over $170 billion. There is also a large army post, Redstone Arsenal, which is one of the largest employers in the state.
Note: GoldBroker cannot provide tax, legal, or other advice, so if you are not sure about the taxation to your personal circumstances, we recommend that you seek independent advice from a qualified professional.
All of these texts were accurate at the time of writing, but tax laws are constantly changing and it’s not easy to keep track of those changes. Because of this, we can not be held responsible for any false or out-of-date information.