A dealer buys gold back for less than it sells it for because the gap between the two prices – the spread – has to cover market risk, operating costs and profit. How much you actually receive depends on the product, its condition and which dealer you sell to, so comparing buyback prices from several US dealers on the day you sell is the most direct way to get more.
What the buyback price and the spread are
Every bullion dealer quotes two prices for the same item. The ask is what you pay when you buy. The bid, or buyback price, is what the dealer pays you when you sell. The difference is the spread, usually expressed as a percentage of the ask.
An example with illustrative numbers: if a 1 oz American Gold Eagle sells for $3,300 and the dealer bids $3,170, the spread is $130, or about 3.9%. If you bought and sold on the same day, that $130 is what you would lose. The gold price has to rise at least that much before you break even.
Bids follow the spot price and change throughout the trading day, so a quote from the morning may not hold in the afternoon. You can follow the current figures on our US gold prices page.
Why the dealer pays less
- Market risk. The price can fall between the moment the dealer buys from you and the moment it resells. The spread is partly a buffer against that.
- Operating costs. Security, insurance, vaulting, testing equipment, staff and shipping to refiners all have to be paid for.
- Liquidity. A dealer that buys back at any time has to keep cash and inventory on hand.
- Profit. The spread is the main way a bullion dealer earns money.
- Premiums that do not come back. Proof coins, graded coins, limited editions and gift products carry a premium when new. Dealers rarely pay all of it back.
If your state charged sales tax when you bought, that tax is a cost you do not get back when you sell. Silver also tends to have wider spreads than gold, because its lower value per ounce makes handling and shipping costs a bigger share of the price.
What affects the price you get
| Factor | Usually a higher bid | Usually a lower bid |
|---|---|---|
| Product | Well-known coins and bars: American Eagle, American Buffalo, Maple Leaf, bars from recognized refiners | Generic rounds, medallions, commemorative or gift items |
| Size | 1 oz coins, 10 oz and 1 kilo bars | Fractional coins and very small bars, where the spread as a percentage is wider |
| Packaging | Original mint tube, capsule or assay card | Opened, damaged or missing packaging |
| Condition | No scratches, dents or engraving | Damaged, cleaned or engraved items |
| Metal | Gold | Silver, with wider spreads and any sales tax paid not recovered |
| Paperwork | Original invoice | No paperwork, sometimes meaning extra testing |
These are general patterns, not rules every dealer follows. Always look at the actual bid for your item rather than a headline percentage.
How to get more for your gold
- Compare several dealers for the exact item. Our US bullion dealers page lists the dealers we track, such as Hero Bullion, SD Bullion, BGASC, Silver.com, Summit Metals, Gainesville Coins and Texas Precious Metals.
- Lock the price. Many dealers lock the bid when you call or submit an online sell order. Ask how long the quote is valid and what happens if the item fails inspection.
- Keep items in original packaging. Mint tubes and sealed assay cards are easier to verify and often get a better bid.
- Keep your invoice. It proves where the item came from and what you paid, which you need to calculate your taxable gain.
- Ask about deductions. Shipping, insurance, testing and payment fees (wire vs. check) reduce what you actually receive.
- Know the melt value. Our gold calculator gives a reference figure so you can see how far below it an offer sits.
Do you have to sell back to the dealer you bought from?
No. You can sell to whichever dealer bids the most. The dealer you bought from does not always pay the highest price. Some only buy products they recognize, and some pay a little more for items they sold. Differences between dealers for the same coin or bar can amount to several percent, which on a 10 oz bar is a meaningful sum.
In person or by mail
- In person. A local coin shop tests the item in front of you and usually pays on the spot. You have to carry the metal yourself, and local bids vary widely.
- By mail. Online dealers lock a price, you ship the metal fully insured, and payment follows once it is received and checked. Keep the tracking number and photos of the package.
- Either way, get written confirmation of the price, any fees and the payment timeline.
Paperwork, payment and tax
Dealers typically ask for a government-issued ID. A dealer that receives more than $10,000 in cash in one transaction or related transactions must file IRS Form 8300, and for certain products and quantities a dealer must report your sale on Form 1099-B. Many popular items, including American Gold Eagles, are generally not on the 1099-B list.
Whether or not a form is filed, you are responsible for reporting your own gain. The IRS treats gold and silver bullion and coins as collectibles: a gain on metal held more than one year is taxed at a maximum federal rate of 28%, and a gain on metal held one year or less is taxed as ordinary income. State income tax may also apply.
Bottom line
The bid is always below the ask. The spread covers the dealer’s risk, costs and profit, and is smallest on large, well-known gold bars and coins and largest on small items and silver. What you receive depends on the product, its condition, your paperwork and the dealer, and bids differ between dealers and move during the day.
Sources: IRS Topic 409: Capital gains and losses · IRS Form 8300 reference guide · US Mint
This is general information, not tax or investment advice.
Frequently asked questions
Why is the buyback price lower than the selling price?
Because the dealer has to cover market risk, operating costs such as security, storage and testing, and its profit. The gap between the bid and the ask is called the spread.
How much do I lose if I buy gold and sell it right back?
You lose the spread, plus any sales tax you paid. The spread is usually small on large, well-known gold bars and coins and wider on fractional coins, small bars and silver.
Do I have to sell to the dealer I bought from?
No. You can sell to any dealer. Bids for the same coin or bar vary between dealers, so it can pay to compare.
Is profit from selling gold taxed?
Yes. The IRS treats bullion and coins as collectibles. Long-term gains are taxed at a maximum federal rate of 28%, and short-term gains as ordinary income.
