NorCal Couple's Record Gold Coin Find A Jackpot For The IRS

(CBS SF) - The Northern California couple who found what could be a record-setting treasure trove of gold coins on their Gold Country property will soon find a huge tax bill headed their way.

According to the Internal Revenue Service Publication 17:

Found property If you find and keep property that does not belong to you that has been lost or abandoned (treasure-trove), it is taxable to you at its fair market value in the first year it is your undisputed possession.

That was established in a 1969 case of a man who found almost $4,500 inside a used piano he bought. Two court rulings determined that such treasure finds are taxable in the year they are discovered.

The couple  will likely be taxed on the gold coins at the top federal rate of 39.6 percent.  Meanwhile, California's top tax rate on joint income is 13.3 percent.

The San Francisco Chronicle reports that factoring in a federal deduction for state income tax paid, and the expected slice for the state and federal government is about 47 percent.

It's estimated the proceeds from the sale of the more than 1,400 gold coins found could reach $10 million dollars, according to Tiburon coin dealer Don Kagin, which would make it the most valuable treasure trove ever found in the U.S.

Kagin said he is representing the couple who have chosen to remain anonymous. He said the couple plans to sell 90 percent of the coins on Amazon.com and keep a few for themselves, some to be sold privately to collectors.

Kagin's senior numismatist, David McCarthy, talked about his examination of the cache of coins with KCBS's Rebecca Corral.