Precious Metals IRA – FAQs

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Curiosity surrounding precious metals IRAs continues to rise and more investors are beginning to incorporate physical assets into their retirement portfolios. Below are common inquiries for those considering precious metals among their alternative investment options.

How does a physical precious metal IRA work?

New Direction IRA allows you to invest in actual precious metals with your self-directed plan. If you want to hold gold as a retirement asset, you can open a physical gold IRA with us (as opposed to an account backed by gold certificates, an ETF, etc.). Coins or bullion may be purchased, sold, or exchanged using your tax-advantaged retirement dollars. Precious metals investing provides the flexibility to conduct transactions at the leisure of the client, so an account composed of physical assets may be adjusted anytime.

As with any asset type, you’ll open an IRA or 401(k) account and fund it via transfer, rollover, and/or contribution. You may then contact the precious metals dealer of your choosing—from a large company to a local shop—and determine the terms of your transaction. Once you reach an agreement and complete the necessary paperwork, we’ll issue a wire from your account to fulfill the dealer invoice. Your dealer will then arrange shipment of the items to a storage account established on behalf of your plan.

What are the precious metals allowed in IRAs?

Gold, silver, platinum, and palladium are allowed in self-directed IRAs. Common items like American Eagle coins, Canadian Maple Leaf coins, and bullion bars in gram or ounce denominations are permissible in retirement plans provided they meet minimum purity requirements:

  • Gold: 99.5%
  • Silver: 99.9%
  • Platinum: 99.95%
  • Palladium: 99.95%

Despite failing to meet the purity minimum, gold American Eagle coins are allowed in retirement plans by virtue of a specific exception in the Internal Revenue Code (IRC).

Can I withdraw my precious metals or will I be required to liquidate?

You may liquidate precious metals on behalf of your IRA or 401(k) if you want to distribute cash. However, you’re under no obligation to do so if you’d rather distribute the items themselves. You have the option of distributing your precious metals in-kind, at which point they would become your personal property. The fair market (or “spot”) values of your withdrawn assets would be reported as income for tax purposes, so you wouldn’t have to worry about added IRS scrutiny directed toward an in-kind distribution.

Can I personally hold precious metals that my IRA owns?

Precious metals owned by your retirement plan must be stored in a depository. We collaborate with these facilities to keep storage fees as competitive as possible. Through interpretation of the IRC, it’s currently possible to purchase precious metals with an IRA-owned entity. Although this alternative avenue would seem to present new possibilities for home storage, the IRS recently clarified that any precious metals owned directly or indirectly by an IRA or 401(k) would have to be stored in a depository or third-party bank. We strongly encourage you to consult with an attorney if you’re considering home storage for IRA-held precious metals.

How do gold and silver IRA accounts differ from other IRAs?

From tax and reporting standpoints, there are no significant differences between precious metals IRAs and other retirement account types. Tax advantages inherent to the various plans (Traditional IRA, Roth IRA, SEP or SIMPLE IRA, etc.) will remain the same, so the only real distinction lies in the asset portfolio. “Gold IRA” and “Silver IRA” are mere descriptors for typical self-directed retirement accounts that hold coins or bullion.

New Direction IRA will be attending the World’s Fair of Money in Denver, CO from August 1-5. To schedule a personal consultation with one of our precious metals experts, please contact us at info@ndira.com with “Precious Metals Consultation” in the subject line. You may also call or e-mail our office with any questions you have before or after the event.

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