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.

What is a "gold IRA" or "precious metals IRA"?

"Gold IRA" and "precious metals IRA" are simply descriptions of self-directed retirement plans that hold physical gold, silver, platinum, and/or palladium. From a tax advantage standpoint, the IRS does not distinguish precious metals IRAs from accounts that hold other asset types.

How does a physical precious metal IRA work?

New Direction Trust Company allows you to invest in physical precious metals with your self-directed plan. 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.

The first step would be to open an IRA, 401(k), or HSA and fund it via transfer, rollover, and/or contribution. You may then contact the precious metals dealer of your choosing—from a large online marketplace to a local coin shop down the road—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.

Which precious metals are 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%

Gold American Eagle coins do not meet the 99.5% minimum for IRA gold, but they are allowed in retirement plans by virtue of the Internal Revenue Code (IRC).

If I want to take a distribution, can I withdraw my precious metals or will I have to liquidate?

You may liquidate precious metals on behalf of your IRA if you want to distribute cash. However, you’re under no obligation to do so if you’d rather distribute the items themselves. You may distribute your precious metals in kind, at which point they would become your personal property. The fair market (“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 third-party depository. We offer a broad range of domestic and international options and collaborate with these facilities to keep storage fees as competitive as possible. Through interpretation of the IRC, it is currently possible to purchase precious metals with an IRA-owned LLC or another such entity. Although this alternative avenue would seem to present new possibilities, we strongly encourage you to consult with an attorney if you're considering home storage for IRA-owned precious metals.

Contact us today!

For more information about gold IRAs or self-directed investing in general, please don't hesitate to contact our Precious Metals Asset Team at 877-742-1270 (Ext. 185) or pmat@ndtco.com.

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