-1

A few years ago, Utah defined gold and silver as legal tender. If I understand this law correctly, this should mean that now that my business is in Utah, I can accept gold as a means of payment (I know about Goldmoney accounts, but technically this still uses "dollars" behind it).

For me (an industrial business), there is a set amount of gold I would take regardless of its USD price, since we directly use it, which is why I'm curious about this, in addition to it saving us time from converting USD to gold.

14
  • 11
    Regardless of where you are, you can accept whatever you like as payment: chickens, flowers, rocks, ... Mar 6, 2017 at 22:40
  • 7
    Note that anywhere in the US, if you accept non-USD payment, you are still responsible for paying the taxes on it at a market-based price. Federally this would be considered barter.
    – Brythan
    Mar 6, 2017 at 22:44
  • 4
    "If I understand this law correctly" Have you considered asking a lawyer? It's their job to understand correctly. An industrial business such as your own no doubt has counsel.
    – Beanluc
    Mar 6, 2017 at 23:27
  • 3
    You say that "there is a set amount of gold I would take regardless of its USD price". That seems strange to me. Assume someone owed you $1200 and they offered you an ounce of gold instead. Wouldn't you rather have the cash if the gold spot price were less than $1200/oz? Then you could buy the gold and have money left over.
    – James
    Mar 7, 2017 at 16:24
  • 3
    The US Dollar doesn't have to "hold its value over time". When someone pays you in cash, you can immediately buy gold with the cash if that is your preference. If the gold spot price is $1200, would you rather have an ounce of gold than $1300? How about $1500? How about $2000?
    – James
    Mar 7, 2017 at 18:42

4 Answers 4

4

You can accept almost anything mutually agreeable to you and the other party as payment. That's the definition of "barter". If you agree to trade manufactured goods for livestock, as long as both parties agree on the terms, I'm not aware of any law that would prohibit it.

I hedged with "almost" because of course you can't accept something that is explicitly illegal. Like you can't say you'll accept cocaine as payment. Less obviously, there are laws regulating the sale of guns, nuclear fuel, agricultural products, etc.

You'd still have to pay taxes, and it can get complicated to determine the taxable value of the transaction. Sorry, but you can't avoid taxes by getting your income in something other than cash.

  • Update

Sigh. In response to Mr Rayburn, let me be more explicit about "I don't know of any law". I search the US Code for the word "barter". Using this web site I found 88 hits. https://uscode.house.gov/search.xhtml?searchString=barter&pageNumber=1&itemsPerPage=100&sortField=CODE_ORDER&action=search&q=YmFydGVy%7C%3A%3A%3A%3A%3A%3A%3A%3Afalse%3A%7C%3A%3A%3A%3A%3A%3A%3A%3Afalse%3A%7Cfalse%7C%5B%3A%3A%3A%3A%3A%3A%3A%3Afalse%3A%5D%7C%5B%3A%5D The only cases in which they say that barter is illegal are cases where ANY sort of transaction is illegal, and they include barter to be complete. For example, there's a law against the unlicensed selling of bald eagles, 16 USC 668, that begins, "Whoever, within the United States or any place subject to the jurisdiction thereof, without being permitted to do so as provided in this subchapter, shall knowingly, or with wanton disregard for the consequences of his act take, possess, sell, purchase, barter, offer to sell, purchase or barter, transport, export or import, at any time or in any manner any bald eagle commonly known as the American eagle or any golden eagle, alive or dead, or any part, nest, or egg thereof of the foregoing eagles, or whoever violates any permit or regulation issued pursuant to this subchapter, shall be fined not more than $5,000 or imprisoned not more than one year or both." Note that the relevant point here is that you can't possess, sell, OR barter. You can't engage in any sort of trade or transaction in bald eagles.

Similarly there are other laws that prohibit sale, barter, etc of illegal drugs, government property, etc. But in all the laws that I could find, no distinction is made for barter. It's not that you can sell but not barter. Barter is included in the list of illegal transactions along with selling, etc.

BTW it occurs to me that a law against barter but permitting selling would be very difficult to enforce. What if the people involved just said, "Oh no, you misunderstand. I didn't trade my bicycle for a microwave oven. I sold him my bicycle for $100 and he sold me his microwave oven for $100. We did the two transactions at the same time so there was no need to hand the cash back and forth."

1
  • Comments are not for extended discussion; this conversation has been moved to chat.
    – JohnFx
    Jul 4, 2022 at 15:44
5

Of course you can accept gold as payment.

Would anyone pay in gold? Would it have tax consequences on your federal taxes? These additional questions are off-topic on this site about personal finance.

1
3

Yes.

"There is, ...no Federal statute mandating that a private business, a person or an organization must accept currency or coins as for payment for goods and/or services."

Taken from the US Department of the Treasury.

1
  • Well, it depends: if there was a debt incurred (before the transaction), they must accept $. But you are correct for the case of just walking into a store and trying to buy something. +1 for the link.
    – Peter K.
    Mar 8, 2017 at 13:00
1

Yes. But the question is do you want to have gold?

If you are going to buy gold anyway, and if you can get a good conversion rate between USD:gold, then why not?

If you are looking to use your earnings on things that you cannot buy using gold, then I'd recommend you take USD instead.

Have fun!

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .