Fineness

Fineness is the proportion of pure precious metal in a coin or bar, expressed in parts per thousand or written as a decimal. A coin described as .999 fine is 999 parts pure metal out of 1,000. The same idea is sometimes stated as a percentage or, for gold, in karats, where 24 karat is pure and 22 karat works out to .9167 fine.

The numbers you see most often on US products are straightforward. The American Silver Eagle is .999 fine silver. The American Gold Buffalo is .9999 fine, 24 karat gold. The American Gold Eagle is 22 karat, .9167 fine, alloyed with silver and copper for durability. Pre-1933 US gold and the Morgan silver dollar are both 90 percent fine.

Fineness is not the same as how much metal a coin contains. A one-ounce Gold Eagle holds a full troy ounce of gold even at .9167 fine, because the coin is struck heavier to compensate. Fineness describes purity; weight describes quantity. Both are printed or documented for every modern US bullion coin.

Purity also decides retirement eligibility, since the IRS sets minimum fineness thresholds for metals held in an IRA.

Educational information only, not tax or legal advice. Texas Bullion Exchange does not provide tax or legal advice — confirm your own situation with your tax professional.

A Texas Bullion Exchange specialist can walk you through the fineness of any coin you are considering.