You just never know what you're going to find buried in your yard:

http://www.npr.org/blogs/thetwo-way/2014/02/26/282859414/what-a-rush-california-couple-finds-gold-coins-worth-10m

Smart move telling the world they found that. Hope they enjoy spending the next few years having their lives wrecked by every Federal, State, County, and City official in 100 miles that'll be trying these seize it from them.

Not to mention every single person who swears that was a relative who put those coins there...

Reports I have read indicate that the discoverers of the cache have "lawyered up" in the same way as major lottery winners are advised to do, that they have remained anonymous ("John and Mary"), the lawyers are doing all the talking, that the precise location of the stash (and, thus, their property) has been hidden/obscured, etc.

You can certainly bet that the numismatists entrusted with the sale of these coins to the public would have carefully investigated any distinct possibility of counterfeiting, etc.

Counterfeiting a non-ancient coin is a tough thing to do where it'll fool the experts, so I doubt there's any real concern over that.
My biggest concern for for the people who found all this would be legal challenges from people popping up claiming some manner of ownership (much like how people jump onto most lottery winners for all manners of insane claims to their 'share' of the winnings).

It has been done in the past. Think gold-plating faked coins. I read a while back of some coins either faked by Nazi officials or faked by counterfeiters that produced a wide range of faked Nazi memorabilia, culminating in the famed "Hitler Diaries" hoax.

I've been told by those who deal with this stuff more than I do that the people who have major stakes in such hobbies as collecting coins, stamps, comic books, exotic cars, etc. and have the resources to pay the major dollars involved pretty much "know about" every substantial object or collection of stuff like this, just like "we" here "know" where every steam locomotive, Pullman car, Baldwin diesel, etc. is located, its history, etc. Many specific rare coins and stamps are even "known" by names of their previous owner, location discovered, etc., and I assure you that the moniker "Saddle Ridge Coin" will follow every last one of these coins as long as they're being sold/traded.

I think you just answered your own concern.
I worked at a Kinko's when i was in college and ran the register a lot, I once was paid with a Russian counterfiet US 'silver' dollar which was steel. I sold that to a local coin collector. We also had a German paper dollar counterfiet come through, I noticed something was odd right away, beside the type of note it was, but that's another story...

A lot of rare (and not so rare) coins are faked in China. This hoard is being sent for authentication before being sold.

These people need to look very hard at tax consequences. Fortunately this struck early in the tax year so they have time.

For instance, donation to charity: There is a huge, critical difference between donating an asset to charity, versus selling an asset and donating the proceeds to charity. The difference is your charitable deduction is capped at 50% of AGI, so who pays tax on the capital gains is a huge big deal.

Another issue is whether the tax is due in year of discovery, or when the coins are liquidated to cash.


Oh, that'll be the LEAST of their problems. Every swindler, salesman and "investment advisor" on planet earth will come out of the woodwork to help them spend that money or invest it in high-commission vehicles.

The art of selling financial products is the art of learning the customer's level of knowledge and selling the most licrative product that is slightly over their head. Variable annuities, insurance, front end load mutual funds, one even tried to pivot me into an index fund with a 1.5% expense ratio (the scam being, 1.5% is reasonable for a managed fund, but for an index fund it's ridiculous.)

I think it's funny that someone thinks their primary threat vector is the government. In my observation, people who focus on such things are blindsided by common, everyday ripoffs.

I understand from one account of this story that I've read that the coins were found last April (2013) so it's been almost a year. That's plenty of time for this couple to get all their ducks in a row before going public with the story.

About half of it goes to the state and the federal government:

http://www.sfgate.com/business/networth ... 271261.php

PC

I wonder if there is any known history of that site that gives any insight as to why the coins were left there. Finding something like that would definitely raise some serious questions about what to do next. One thing that comes to mind is going through all the ground on the site with a fine tooth comb to see if there is any other treasure there.

Do I taste sour grapes in this discussion?

I, for one, would be delighted to find a hoard of multi-million dollar gold coins in my yard. How many million do you need to be happy?

It was certainly not uncommon for people to bury their money in the back yard, especially following the various bank panics in the late 19th century. I had a neighbor when I was a kid who had lived through the Depression and didn't trust banks. After he died, his sons found $350,000 cash in five-gallon milk cans in the basement of his house.

Richard, ask Suze Orman, but be prepared for a surprise. Getting old is more expensive than it used to be.

Preston, this article is "spitballing" by the Chronicle and a bit of a hack job at that. They are presuming a lot of stuff that isn't necessarily in evidence. First they are pretending that the parties have not availed themselves of any tax shelters, and that's just silly. Of course they would.

Second, there's a problem. It is universally accepted in tax law, that a capital gain on items of value are not taxed until their value is converted to cash. It has to be that way, otherwise you're blindly grasping at hypothetical valuations, which is a recipe for disaster - ask any homeowner in the 2000s.

However this stuff ***is*** cash. And that's why the Chronicle grabbed the precedent. http://en.wikipedia.org/wiki/Cesarini_v._United_States
Essentially, found currency is taxable immediately, because it has clear, undisputed, known value in US currency. Stamped right on it.



The precedent says that found money is not capital gain. But the precedent clearly applies to the face value: $4467 in the precedent, $27,000 in this case. Badabing.

My prediction:
1. They'll need to declare the $27,000 as regular income in 2013. 28% Federal, 11.2% Calif. brackets if they're typical around here.

2. Some wing-nuts are claiming some of these coins might be worth more than face value. Maybe. If that ever happened, they'd owe taxes on the difference at that time. And that's definitely a capital gain, and the precedent doesn't fit because it did not consider collector value of the money.

There is no dispute that if Cesarini (the precedent) still had some of those old bills, and sold them on eBay today for over face value, the difference would indeed be capital gain.