Whether you need a license to sell precious metals depends on whether you’re selling your own items or running a business that buys metals from other people to resell. An individual unloading personal gold, silver, or platinum does not need a dealer license under federal law. Once buying and selling becomes a regular pattern, though, state licensing, local permits, and — if your volume is high enough — federal anti-money-laundering rules all come into play.
Selling Your Own Metals
If the gold chain, silver flatware, or inherited coins you want to sell belong to you, no federal dealer license exists that you need to obtain first. Selling a wedding ring on a marketplace or trading old coins at a local shop does not make you a dealer. The federal precious metals dealer rules apply only to businesses that both buy and sell covered goods above set dollar thresholds, and a one-time or occasional personal sale is not business activity.
That said, the buyer on the other side of your transaction may have reporting obligations that touch you. If a dealer pays you more than $10,000 in cash for your metals, they are required to file IRS Form 8300 identifying you as the seller. That’s their filing, not yours, but it means large cash sales are not anonymous.
When Selling Becomes a Business
The line blurs when selling turns into a pattern. If you regularly acquire precious metals from other people and resell them for profit, most states will treat you as a secondhand dealer or precious metals business — even without a storefront. Frequency and volume drive that determination, not whether you consider it a hobby. A useful rule of thumb: if you’re buying items from the public with the intent to resell them, regulators will see you as running a business.
Once you cross into business activity, three separate layers of regulation may apply: state licensing, local permits, and federal anti-money-laundering rules. Each has its own trigger, and complying with one does not satisfy the others.
State Dealer Licensing
Most states do not have a standalone “precious metals dealer” license. Instead, they regulate this activity under broader categories such as secondhand dealer, precious metals dealer, or pawnbroker statutes. If you buy used gold, silver, or jewelry from the public for resale, you almost certainly need a license from your state, regardless of what the license is called.
Getting licensed typically means submitting an application to an agency like the state’s Department of Commerce or Division of Consumer Affairs, passing a criminal background check, and paying a fee. Application and renewal fees vary widely, from under $50 to several hundred dollars depending on the state. Many states also require a surety bond, generally in the $5,000 to $10,000 range, which protects customers if the dealer fails to meet its obligations.
State laws commonly impose operational rules alongside the license itself. Mandatory holding periods require a dealer to keep purchased items for a set number of days before reselling or melting them, giving law enforcement time to check items against stolen property reports. Holding periods run from a few days to several months depending on the jurisdiction. Some states also require dealers to submit regular transaction reports to local law enforcement.
Local Permits, Zoning, and Scales
Even where state licensing is light, cities and counties typically require a general business license for any commercial enterprise operating within their boundaries. These local permits are separate from any state-issued dealer license, and you’ll usually apply through city hall or the county clerk’s office.
Many municipalities go further with ordinances specifically targeting secondhand goods dealers. Local laws can require reporting transactions to local police, restrict operating hours, or impose additional record-keeping requirements beyond what state law demands. Check your local ordinances before assuming state compliance is enough.
Zoning also matters. A precious metals business, particularly one that buys from walk-in customers, may be classified differently than a standard retail shop. Before signing a lease or purchasing property, confirm the location is properly zoned for your intended operations.
If you weigh metals to determine purchase prices, your scales must meet accuracy standards. NIST Handbook 44 classifies retail precious metals weighing as requiring a Class III scale, which has tighter tolerances than a standard commercial scale.1National Institute of Standards and Technology (NIST). NIST HB 44-2025 Specifications, Tolerances, and Other Technical Requirements for Weighing and Measuring Devices Most state and local weights-and-measures agencies adopt these standards and may require periodic inspection and certification of your equipment.
Federal Rules Above $50,000
Federal regulation of precious metals dealers comes from the Bank Secrecy Act and the USA PATRIOT Act, which treat qualifying dealers as financial institutions overseen by the Financial Crimes Enforcement Network (FinCEN). The rules are codified at 31 CFR Part 1027.
Under the federal definition, you are a dealer if, during the prior calendar or tax year, you both purchased more than $50,000 in covered goods and received more than $50,000 in gross proceeds from selling them. Both conditions must be met. Covered goods include precious metals, precious stones, and jewels in any form.2eCFR. 31 CFR Part 1027 – Rules for Dealers in Precious Metals, Precious Stones, or Jewels
Several categories are carved out. A retailer that only buys inventory from other dealers or retailers is not a “dealer” for FinCEN purposes, unless it also purchases more than $50,000 from the general public or foreign suppliers. Licensed pawnbrokers are excluded for their pawn transactions, including sales of unredeemed collateral. Businesses that buy precious metals solely for incorporation into industrial machinery or equipment are excluded entirely.2eCFR. 31 CFR Part 1027 – Rules for Dealers in Precious Metals, Precious Stones, or Jewels
Every dealer meeting the threshold must develop and maintain a written anti-money-laundering (AML) program designed to prevent the business from being used for money laundering or terrorist financing. The program must include policies and internal controls tailored to the dealer’s specific risk profile, a designated compliance officer, ongoing training for employees who handle transactions, and independent testing to verify the program actually works.2eCFR. 31 CFR Part 1027 – Rules for Dealers in Precious Metals, Precious Stones, or Jewels
FinCEN expects the program to reflect actual risks. A storefront buying scrap gold from walk-in customers faces different laundering risks than an online bullion dealer shipping internationally, and their programs should look different.3Department of the Treasury. Anti-Money Laundering Programs for Dealers in Precious Metals, Precious Stones, or Jewels
The $10,000 Cash Rule Applies to Any Business
Separate from the AML program requirement, any business that receives more than $10,000 in cash from a single transaction or a series of related transactions must file IRS Form 8300. This rule comes from 26 U.S.C. § 6050I and applies to every trade or business in the country, not just those above the FinCEN dealer threshold.4Internal Revenue Service. Form 8300 and Reporting Cash Payments of Over $10,000
“Cash” for this purpose is broader than paper currency. It includes foreign currency, certain monetary instruments with a face amount of $10,000 or less (such as money orders, cashier’s checks, and traveler’s checks), and digital assets. A personal check drawn on the buyer’s own bank account does not count.5Office of the Law Revision Counsel. 26 U.S. Code 6050I – Returns Relating to Cash Received in Trade or Business
Deliberately breaking a transaction into smaller amounts to stay under $10,000 is called structuring, and it is illegal. The statute prohibits anyone from causing a business to fail to file, filing a false return, or structuring transactions to evade the reporting requirement. A customer who asks you to split a $15,000 purchase into two receipts is asking you to commit a federal offense.5Office of the Law Revision Counsel. 26 U.S. Code 6050I – Returns Relating to Cash Received in Trade or Business
Records You Must Keep
Federal, state, and local laws all impose record-keeping obligations on precious metals dealers, and the requirements overlap. The goal is the same at every level: create a traceable history for items acquired from the public, making it harder for stolen goods to disappear into the supply chain and harder for cash to be laundered through metal transactions.
Most jurisdictions require dealers to record the following when buying metals from a seller:
- Seller’s full legal name, current address, and date of birth, verified by a government-issued photo ID
- The type of identification document and its number
- A detailed written description or digital photograph of each item purchased
- A signed statement from the seller confirming they have the legal right to sell the property
- A physical description of the seller, or a thumbprint, in some jurisdictions
These records must be retained for a period specified by your jurisdiction, often several years, and made available to law enforcement on request. Incomplete records are one of the most common compliance failures, and one of the first things an auditor or investigator will check.
What Happens If You Skip It
Buying and selling precious metals without the required state license is typically a misdemeanor, though penalties vary. Beyond fines and possible jail time, operating unlicensed can result in forfeiture of inventory and permanent disqualification from getting a license later. State regulators share information with federal authorities, so a state-level violation can trigger a closer look at your federal compliance.
Failing to file Form 8300 on time or filing it with incomplete information triggers civil penalties under IRC § 6721, adjusted annually for inflation. Negligent failures start at $50 per late return and rise from there.6Internal Revenue Service. Form 8300 History and Law Intentional disregard is treated far more harshly: the penalty jumps to the greater of $25,000 per return or the amount of cash involved, with no annual cap, and criminal penalties including imprisonment can also apply. Structuring transactions to avoid filing carries the same civil and criminal sanctions as failing to file at all.5Office of the Law Revision Counsel. 26 U.S. Code 6050I – Returns Relating to Cash Received in Trade or Business
Operating above the $50,000 federal threshold without an AML program, or maintaining one that exists only on paper, exposes the business to enforcement action by FinCEN, including substantial civil fines and, in serious cases, criminal prosecution. FinCEN has taken action against dealers who failed to implement effective programs, and the penalties tend to be large enough to close a small operation.