Personally Transporting Precious Metals: Reporting Rules
It’s perfectly legal to move precious metals in or out of the United States. But you must understand the reporting rules before you begin. Otherwise, your risk confiscation of your metals along with possible civil and criminal sanctions. You’re much better off paying an armored security service such as Brinks or ViaMat to transport the metals for you.
But if you want to walk, drive, or fly across a US border carrying, say, 100 one-ounce US gold eagles with a market value of US$215,000 in your carry-on bag, there are two sets of rules with which you must pay attention to:
- Rules from the Treasury Department requiring that you report certain movements of currency and monetary instruments across a US border. These rules don’t appear to apply to gold and silver bullion or coins.
- Rules from the Census Bureau obligating you to make a declaration if the value of certain commodities that you export from has a value that exceeds $2,500. These rules are poorly publicized. But border officials routinely confiscate precious metals from travelers who aren’t aware of them.
Gold and Silver Are Not “Currency or Monetary Instruments”
If you or your agent (e.g., an armored security service) physically transports currency or monetary instruments with an aggregate value that exceeds $10,000 at one time across a US border, you must submit Treasury Form 105, the “Report of International Transportation of Currency or Monetary Instruments” (CMIR).
According to the Treasury Department bureau responsible for Form 105, the Financial Crimes Enforcement Network (FinCEN), the following items are considered currency or monetary instruments. Therefore, they must be reported on the CMIR:
(1) Coin or currency of the United States or of any other country,
(2) Traveler’s checks in any form,
(3) Negotiable instruments (including checks, promissory notes, and money orders) in bearer form, endorsed without restriction, made out to a fictitious payee, or otherwise in such form that title thereto passes upon delivery,
(4) Incomplete instruments (including checks, promissory notes, and money orders) that are signed but on which the name of the payee has been omitted, and
(5) Securities or stock in bearer form or otherwise in such form that title thereto passes upon delivery.
Monetary instruments do not include:
(i) Checks or money orders made payable to the order of a named person which have not been endorsed or which bear restrictive endorsements,
(ii) Warehouse receipts, or
(iii) Bills of lading.
Some countries, including the United States, consider gold and silver coins (but not bars) to be currency. For instance, a one-ounce US gold eagle has a legal tender value of $50 stamped on the coin. However, according to a FinCEN administrative ruling:
The term ‘currency’ is defined in our regulation as ‘the coin and paper money of the United States or of any other country that (1) is designated as legal tender, (2) circulates, and (3) is customarily used and accepted as a medium of exchange in the country of issuance.’ Coins or paper money must satisfy all three conditions to be considered ‘currency’; a failure to satisfy one prong means that the payment instrument is not ‘currency’ for CMIR purposes.
Going back to our example. One-ounce gold eagles are legal tender. But they don’t circulate and they’re not customarily used as a medium of exchange in the United States. Therefore, they’re not considered currency and need not be reported on the CMIR.
Failing to submit the CMIR does not guarantee immunity from potential scrutiny by customs officials. It may be beneficial to carry a hard copy of the FinCEN’s official guidelines outlining the criteria for coins to qualify as currency.
The Census Bureau regulations are a very different matter.
Failure to Make Obscure Census Filing Leads to Confiscation
According to an article in the Houston Chronicle published in May 2010, US Customs and Border Protection (CB&P) officials at Houston’s George Bush Intercontinental Airport seized almost $160,000 in gold and silver in one month alone. It seems safe to conclude that CB&P confiscates many times this amount at other US border crossings.
What surprised us was the reason why CB&P agents seized the gold and silver. They did so because the travelers transporting it failed to say what they had on a US Census Bureau “Shipper’s Export Declaration.”
You must complete this declaration when you transport certain “commodities” (including gold and silver) out of the United States if the shipment has a value of $2,500 or more. Failing to file the declaration can result in confiscation of the undeclared commodities. It can also lead to a fine of up to $10,000 and possible imprisonment.
Go to the CB&P website and you’ll find a page labeled “Export Licenses.” It states:
Exports may require a Shipper’s Export Declaration (SED). “The Correct Way to Fill Out the Shipper’s Export Declaration” site provides step by step instructions on how to complete an SED and when an SED is required.
Unfortunately, the instruction manual mentioned is not readily available on the CB&P website. By searching for “Shipper’s Export Declaration” online, we found a document titled “Correct Way to Fill Out the Shipper’s Export Declaration” published by Bradley University.
Caution: Outdated Instructions. But it’s important to note that the instructions provided in the “Correct Way to Fill Out the Shipper’s Export Declaration” document may be outdated. Simply filing the form when crossing the border may not be enough to ensure full compliance.
The REALLY Correct Way to Fill Out the SED
Export shipments that once required a paper SED (Form 7525-V) now require an electronic filing via a government website called the Automated Export System (AES). Once the AES processes and accepts the Electronic Export Information (EEI) pertaining to your shipment or shipments, it will generate an Internal Transaction Number (ITN). You must post this number as proof of filing on your “loading documents” prior to exporting them. When you leave the United States, a CB&P official may verify the ITN.
After reviewing the AES website, it’s evident that user-friendliness is lacking. The platform seems tailored for extensive exporters with dedicated staff solely focused on government form submissions.
Fortunately, if you use an armored transport service such as Brinks or ViaMat to export your metals overseas, it will generally obtain the ITN on your behalf (but be sure to ask). But if you want to hand-carry your precious metals across the border, you’ll need to generate the ITN yourself—or try to find an exemption.
The “Baggage and Personal Effects” Exemption
You might be wondering if ordinary citizens need to comply with these seemingly complex regulations. The answer is both yes and no.
Buried within the Code of Federal Regulations (CFR), specifically Title 15 CFR Part 30, you’ll find the rules governing these requirements. Reading through these regulations can be a real challenge. One section that caught our attention is 30.35, “Procedure for shipments exempt from filing requirements.”
The procedure for claiming an exemption begins with the rather imposing requirement that:
Where an exemption from the filing requirement is provided in this subpart of this part, a legend describing the basis for the exemption shall be made on the first page of the bill of lading, air waybill, or other commercial loading document for carrier use, or on the carrier’s outbound manifest. The exemption legend shall reference the number of the section or provision in this part where the particular exemption is provided (see Appendix D of this part).
Moving on to section 30.37(p), you’ll discover:
(p) Filing EEI is not required for the following types of commodities when they are not shipped as cargo under a bill of lading or an air waybill and do not require an export license, but the USPPI shall be prepared to make an oral declaration to CBP Port Director, when required: baggage and personal effects, accompanied or unaccompanied, of persons leaving the United States, including members of crews on vessels and aircraft.
In case you were wondering, a USPPI is a “US Principal Party in Interest.” According to AES Direct, this is “the person in the United States that receives the primary benefit monetary or otherwise of the export transaction.” This would be you, if you are the person shipping gold, silver, or other commodities outside the United States.
At first glance, it would appear that the seizures in Houston should not have occurred if the USPPI had the gold and silver as part of their “baggage and personal effects.” But the reality is not quite so straightforward. For instance, the definition of personal effects is:
Usual and reasonable kinds and quantities of wearing apparel, articles of personal adornment, toilet articles, medicinal supplies, food, souvenirs, games, and similar personal effects and their containers.
Lack of clarity. Nowhere in the regulations is there mention of coinage, currency, or precious metals. You may argue that the 100 one-ounce gold eagles discreetly tucked into your briefcase qualify as “personal effects.” But Customs and Border Protection (CBP) agents could interpret this differently based on various factors like their mood, temperament, political stance, or specific directives.
Legal Insight. We consulted Attorney Carolita Oliveros for this post. She advises clients who plan to carry gold or silver coins or bullion across the border to ensure these metals are fully insured for their value. This precaution covers potential losses due to confiscation, theft, or misplacement.
Transporting Precious Metals Yourself
If you intend to transport gold and silver out of the United States yourself, you have several options. You could engage an attorney to prepare your Shipper’s Export Declaration (SED) or utilize an armored transport service.
Or, before your departure, consider scheduling a meeting with the CBP Port Director. If you manage to speak with them, inquire about the specific policies regarding the baggage and personal effects exception at that particular port. Seek confirmation from the Port Director that filing Treasury Form 105, the “Report of International Transportation of Currency or Monetary Instruments,” is not required. Follow any guidance provided and aim to get written documentation confirming your compliance with the regulations.
Beyond US regulations, it’s crucial to understand the rules of the country where you plan to import your metals and any countries you will transit through. Some nations mandate declarations for precious metal imports, potentially requiring import taxes based on factors like metal type, purity, and form (coins or bullion). Regulations vary by country, although certain regions like the EU may have unified tax rules for imported precious metals.
If you wish to import precious metals into the United States, be ready for a completely different set of rules.
How to Ship Gold Internationally in Six Steps
Shipping gold overseas from the US might sound straightforward. But it can be quite a process. If you’re thinking about it, here’s what you need to know: How to Ship Gold Internationally.
How to Best Store Precious Metals in the US and Offshore
Once you’ve made the decision to ship your precious metals overseas, how do you best store them. You can find more information here: How to Store Precious Metals.
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