You can hold precious metals within any type of IRA to diversify and shelter them from taxation. As any gold broker will point out, tax shelter and diversification both are good things. Be sure to review the fine print before you get out the phone, or even the mouse. You can get the best gold IRA company on our place.
1. No Collectibles
The tax code is about encouraging productive investment. Not indulgent love for coins from the Roman Empire or baseball cards. So collectible or numismatic currency is not allowed for IRA purposes. If a coin’s worth is solely based on its rarity then it is considered an illegal collectible. If it isn’t, it may be eligible for an IRA. Your broker should tell you which coins to buy.
2. Storing in an Approved Bank
Your gold can not be buried in the back yard. It must be stored at an approved, third party depository. It is illegal to do so, as it would be considered a distribution. Problem: If your reasoning for owning gold is to cause a collapse in society, then physical access to your metal could be a problem.
Your gold broker and storage depository are not free. Expect to pay a transaction fee, account set-up fee and annual administration fees as well as a storage fee, “IRA”, or any other fee they choose. You shouldn’t be offered a low metal price only to lose out on price because of high fees. Compare the metal price with all fees.
4. Metal Price? – Is this not about Gold?
The Taxpayer Relief Act of 97 states that gold, palladium, silver, and platinum all qualify for favored IRA status, so long as they are of suitable quality. There is more flexibility for you, as the price per an ounce can vary widely among precious metals. If your broker doesn’t handle silver that is relatively cheap, they can help you find one.
5. It must be a New Purchase
You think you already have some gold, but you would like to taxproof that. No, you cannot taxproof any bullion coins or bullion that has been purchased previously. The money you used to purchase the coins or bullion can be old but the metal has to be new.