This is called capital gains tax. And since gold is an investment asset, when you sell your gold and make a profit, it's taxed as capital gains. However, depending on how you've held your gold, you'll have to pay taxes at the ordinary capital gains rate or at an overall rate of 28%. Long-term earnings on ingots are taxed at the ordinary income tax rate, up to a maximum rate of 28%.
To help you understand the taxation process better, you can refer to a Gold IRA rollover guide. Short-term earnings on ingots, like other investments, are taxed as ordinary income. An asset must be held for more than one year for gains or losses to be long-term. For example, VanEck Merk Gold (OUNZ) owns gold ingots and stores them in vaults, but allows investors to exchange their shares for ingots or bullion coins. Investors with a Roth IRA pay income tax in advance on a purchase, but all future growth is tax-free; investors with a pre-tax IRA pay their usual types of income taxes when they withdraw money in retirement.
Gold is often taxed differently than other investments, and tax rules vary depending on which of the many different ways to invest in gold you choose. If an IRA buys a non-exempt collector's item, the purchase amount is included in the owner's gross income at the time of purchase and a penalty is applied for each year the investment remains in the IRA. Gold and silver bars may attract unwanted attention or require special statements for monetary instruments, but a gold necklace is, well, just another gold necklace. Examples include SPDR Gold Shares (GLD), iShares Gold Trust (IAU), Aberdeen Standard Gold ETF Trust (SGOL) and iShares Silver Trust (SLV).