Demonetization Deadline Extended Again
The Supreme Court of Nigeria has granted the Federal Government's request to extend the lifespan of the N1000, N500, and N200 naira notes for the second time. With the previous deadline of December 31, 2023, set by the same court nearing, the Nigerian government was forced to seek an extension of the validity of the notes.
Supreme Court Invalidates Previous Demonetization Directive
Before the latest ruling, the Supreme Court had previously invalidated a demonetization directive issued by then-President Muhammadu Buhari. At the time, the court criticized the Buhari government and then Central Bank of Nigeria (CBN) governor Godwin Emefiele for implementing the process without consulting the public.
Controversial Demonetization Process
The Central Bank of Nigeria's controversial old naira banknote demonetization was initially scheduled to be completed by the end of 2022. However, many Nigerians were unable to exchange their old banknotes before the deadline, leading to cash shortages. As a result, the central bank extended the cut-off day multiple times.
Legal Tender Status of Old Banknotes
The Supreme Court panel, led by John Okoro, has directed that the old naira banknotes should remain legal tender until they are replaced with the redesigned notes. This decision allows the old and redesigned notes to coexist as legal tender.
Consultation with Stakeholders
Explaining the reasoning behind the judgment, Okoro stated that the old versions of the 200, 500, and 1000 naira notes will continue to be legal tender alongside the new versions until the government consults with critical stakeholders and puts all required structures in place.
Reiteration of Legal Tender Status
The Central Bank of Nigeria (CBN), under the leadership of Olayemi Michael Cardoso, has reiterated that all banknotes, including the previously demonetized naira, will remain legal tender indefinitely, even beyond the initial December 31, 2023, deadline.
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Frequently Asked Questions
Can the government take your gold
Because you have it, the government can't take it. It's yours, and you earned it by working hard. It belongs to you. This rule could be broken by exceptions. If you are convicted of fraud against the federal government, your gold can be forfeit. If you owe taxes, your precious metals could be taken away. However, even if taxes are not paid, gold is still your property.
How is gold taxed by Roth IRA?
A tax assessment for an investment account will be based on the current market value, and not what you paid initially. All gains, even if you have invested $1,000 in a mutual funds stock, are subject to tax.
If you place the money in a traditional IRA, 401(k), or other retirement plan, there is no tax when you take it out. Dividends and capital gains are exempt from tax. Capital gains only apply to investments more than one years old.
These rules vary from one state to another. In Maryland, for example, withdrawals must be made within 60 days of reaching the age of 59 1/2 in order to qualify. Massachusetts allows you to wait until April 1. And in New York, you have until age 70 1/2 . To avoid penalty fees, it is important to plan and take distributions in time to pay all your retirement savings.
Who owns the gold in a Gold IRA?
An individual who has gold is considered to be a “form of money” by the IRS and subject to taxation.
This tax-free status is only available to those who have owned at least $10,000 of gold and have kept it for at minimum five years.
The purchase of gold can protect you from inflation and price volatility. But it's not smart to hold it if your only intention is to use it.
If you plan on selling the gold someday, you'll need to report its value, which could affect how much capital gains taxes you owe when you cash in your investments.
It is a good idea to consult an accountant or financial planner to learn more about your options.
Can I hold physical gold in my IRA?
Gold is money, not just paper currency or coinage. People have used gold as a currency for thousands of centuries to preserve their wealth and keep it safe from inflation. Today, investors invest in gold as part a diversified portfolio. This is because gold tends do better in financial turmoil.
Many Americans today prefer to invest in precious metals, such as silver and gold, over stocks and bonds. It's not guaranteed that you'll make any money investing gold, but there are several reasons it might be worthwhile to add gold to retirement funds.
Another reason is the fact that gold historically has performed better than other assets in times of financial panic. Between August 2011 and early 2013 gold prices soared nearly 100 percent, while the S&P 500 plunged 21 percent. During turbulent market conditions gold was one of few assets that outperformed stock prices.
Gold is one of the few assets that has virtually no counterparty risks. Your stock portfolio can fall, but you will still own your shares. Gold can be worth more than its investment in a company that defaults on its obligations.
Finally, the liquidity that gold provides is unmatched. This means that you can sell gold anytime, regardless of whether or not another buyer is available. Because gold is so liquid compared to other investments, buying it in small amounts makes sense. This allows one to take advantage short-term fluctuations within the gold price.
Statistics
- If you take distributions before hitting 59.5, you'll owe a 10% penalty on the amount withdrawn. (lendedu.com)
- Indeed, several financial advisers interviewed for this article suggest you invest 5 to 15 percent of your portfolio in gold, just in case. (aarp.org)
- Gold is considered a collectible, and profits from a sale are taxed at a maximum rate of 28 percent. (aarp.org)
- (Basically, if your GDP grows by 2%, you need miners to dig 2% more gold out of the ground every year to keep prices steady.) (smartasset.com)
- You can only purchase gold bars at least 99.5% purity. (forbes.com)
External Links
law.cornell.edu
- 7 U.S. Code SS7 – Designation board of trade as contract marketplaces
- 26 U.S. Code SS 408 – Individual retirement accounts
bbb.org
irs.gov
cftc.gov
How To
3 Ways To Invest in Gold For Retirement
It's crucial to understand where gold fits in your retirement strategy. There are many ways to invest in gold if you have a 401k account at work. You might also consider investing in gold outside your workplace. If you have an IRA (Individual Retirement Account), a custodial account could be opened at Fidelity Investments. You might also consider purchasing precious metals directly from a trusted dealer if they are not already yours.
These are the three rules to follow if you decide to invest in gold.
- Buy Gold with Cash – Avoid using credit cards or borrowing money to fund investments. Instead, cash in your accounts. This will protect you from inflation and help keep your purchasing power high.
- Physical Gold Coins You Should Buy – Physical gold coins should be purchased over a paper certificate. Physical gold coins can be sold much faster than paper certificates. Physical gold coins don't require storage fees.
- Diversify Your Portfolio. Never place all your eggs in the same basket. This is how you spread your wealth. You can invest in different assets. This can reduce market volatility and help you be more flexible.
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By: Terence Zimwara
Title: Nigeria's Supreme Court Extends Lifespan of Naira Banknotes Again
Sourced From: news.bitcoin.com/nigerian-supreme-court-extends-old-banknote-demonetization-deadline-again/
Published Date: Fri, 01 Dec 2023 11:30:36 +0000
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