The IRS defines purity requirements These criteria ensure that the coins and bars are sufficient to be included in an IRA. The IRS requires that gold be at least 0.995 or 99.5% pure gold. For example, gold bars must have a purity of 99.5% or more and silver bars must have a purity of 99.9% or better. The practical concern is to find an IRA trustee who is willing to set up an independent IRA and facilitate the physical transfer and storage
of precious metal assets.
Only a few companies are prepared to act as trustees for independent IRAs that hold eligible precious metal coins or bars. Gold American Eagle investment coins and polished gold coins are the only gold coins that are exempt from purity guidelines. A precious metal IRA is a self-directed IRA that allows you to hold certain types of precious metals (gold, silver, platinum, and palladium) as part of your overall wealth mix. Funds can be added to your IRA through a transfer between IRA custodian banks, a transfer between retirement accounts, or as a new cash deposit to a new
IRA account.
Physical gold can play an important role in a well-diversified retirement portfolio. However, there are certain rules to follow if you want to take advantage of all the benefits that an individual retirement account (IRA) made of gold or other precious metals can offer. However, the distribution of tax benefits and contribution limits differ from those of traditional gold IRAs. Buying shares in an exchange traded fund (ETF), which tracks the value of a precious metal, is an option for those who don’t want to address the issues associated with physically owning precious metal coins or bars through IRAs. The main difference with SEP Gold IRAs is that you can make much larger contributions with them than with traditional IRAs or Roth IRAs
.
Segregated storage is a form of storage that keeps your assets separate from other gold or silver investments that are either outside the IRA or owned by someone else. If the IRS determines that the day your IRA gold came into your home was the “distribution” date, you may end up paying additional penalties and back taxes owed from the time it was distributed. IRA gold accounts must be set up and managed by an IRS-approved custodian, and specific documentation and tax reporting requirements must be considered. You may love South African Krugerrand gold coins, but you can’t add them to
your IRA Gold account.
In general, an IRA investment in a metal or coin is considered an acquisition of a collectible item. Although IRAs used to be limited to holding American Eagle gold and silver coins, IRAs can now invest in IRS-approved gold, silver, palladium, and platinum bars and coins. Not only can you contribute to an employer-sponsored 401 (k), but you can also contribute to a Roth IRA, a traditional IRA or a Roth self-directed IRA. The IRS has strict guidelines on what types of gold coins and gold bars can be stored in a gold IRA
.
