Investing in gold? Your tax rate could be 28% AFP/Getty ImagesAn Austrian worker handles ten kilogram 'raw' gold bars in a gold bullion factory in Vienna.As an investor, you may be worried about stock market risk, and who can blame you? Unfortunately, the safest fixed-income investments — like CDs, Treasurys, and money-market funds--are paying near-zero interest rates despite the possibility of significant future inflation. Not good. In this environment, the idea of investing some taxable money in gold and other precious metal assets could be appealing. But read this to make sure you understand the tax angles. There are no tax-law restrictions on an individual having direct physical ownership of precious metal coins and bullion. Believe it or not, however, these assets are considered collectibles for federal income tax purposes (just like Beanie Babies). As such, any net long-term capital gains when these assets are sold by an individual taxpayer are subject to a maximum federal income tax rate of 28%, instead of the standard 20% maximum rate on long-term gains. Here’s how the 28% maximum rate deal works. If you are in the 28%, 33%, 35%, or 39.6% federal income tax bracket, net long-term gains from collectibles, including precious metal assets, are taxed at 28%. However, higher-income folks may also owe the dreaded 3.8% net investment income tax. If so, the maximum effective federal rate on long-term gains from precious metals can be 43.4% (39.6% + 3.8%). If you are in the 10%, 15%, or 25% bracket, your net long-term gains from collectibles, including precious metal assets, are taxed at your regular rate of 10%, 15%, or 25%. In these brackets, you don’t have to worry about owing the 3.8% net investment income tax.