Tax questions related to SPDR Gold ETF

Posted by Dadalee on March 10, 2013 (05:50AM)

Hi, I am new to investing in SPDR Gold ETF. I bought this ETF in July last year, and I still own it as of today. My question is if I didn't sell the Gold ETF, do I have to file the tax on this ETF ?

I did some research, and some people said I still need to file the tax for this, is it true?

If I do have to file this, I've been trying to use TurboTax to do it, but it asks me to input "net proceeds," and "the date I sell it," which are confusing because I didn't sell it, and I am also not sure what does net proceeds refer to in this case.

I've posted this question on TurboTax website a while ago, but no body replied me, so hopefully someone else here in this forum can help me with this.

Really appreciate it, thank you!...

Posted by Scofflaw on March 10, 2013 (09:01PM)

Dadalee - There is a document you should receive from the SPDR Gold Trust called the 2012 Grantor Trust Tax Reporting Document.

You might also find it online using a good search engine or at the SPDR site.. The document is the same for all GLD investors.

This document outlines the steps you need to take for tax reporting purposes.  There are two pieces to this.  One to determine your share of investment expenses and the other to determine any gains from your portion of the Trust's gross proceeds from buying and selling gold bullion.   

I believe the bottom line is that you will not have any tax liability and just need to adjust your cost basis.  But that gets determined after you go through the calculations provided with the GLD Tax Reporting Document  

Posted by Dadalee on March 11, 2013 (03:08AM)

Hi Scofflaw,

thx for the reply!

I have looked through the document provided by SPDR site, and found an website that can calculate investment expense and cost basis.

My question is just that what does "net proceeds" refer to ? is it the investment expense or is it the capital gain ?

Posted by Scofflaw on March 11, 2013 (11:48AM)

The 'net proceeds' is your share of purchase or sale of bullion by the GLD trust.   The Trust's income and expenses 'flow through' to the shareholder.

This would be a capital gain/loss depending on the calculation.  You are reporting your share of the cost of gold sold by the Trust - not your shares of GLD.  There is also a cost basis adjustment calculation that would probably lower your cost basis when you sell your GLD shares.

The investment expense calculation would be Schedule A deduction if you can overcome (along with other investment expenses etc) the 2% cap on your income.  

Also, since TurboTax will probably insist on a sell date for any capital gain/loss I would use Dec 31, 2011 or the last trade date for the calendar year indicated on the Gross Proceeds File..

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