Are Coins and Bullion Allowed in an IRA?
Precious metals must generally be stored away from one’s personal control in order to be considered eligible for inclusion in an Individual Retirement Account (IRA), so most IRA investors opt for storing their metals with an IRS-approved depository.
Gold IRA investors can also invest in bars and rounds that meet certain purity standards; but how can you determine whether these investments qualify as eligible investments in an IRA?
Purity
When it comes to gold, silver, and platinum coins and bullion approved for investment within an IRA account, the IRS imposes stringent rules as to their suitability for purchase. All approved metals must possess high levels of purity.
Government-minted gold and silver coins that meet IRS purity guidelines may be eligible to be included in an IRA account, such as the 1 oz American Gold Eagle coin and Australia Kangaroo gold coin. Other popular choices for IRA-approved gold coins are Austrian Philharmonic coins and Canadian Maple Leaf coins.
Bullion bars and rounds that meet minimum purity standards may also be added to an IRA. These may come from private mints or national governments. At present, only rare or collectible coins such as British Sovereigns, Swiss Francs or German Marks certified for certification can be held within an IRA account.
Weight
There are various coins produced in gold, silver and platinum bullion; however, due to IRS restrictions only certain IRA-approved coins may be held by an IRA custodian rather than personally. This means you are limited to owning one-ounce US gold bullion coins minted by the Treasury Department as well as minimum fineness bars or rounds produced from national government mints or accredited refiners, assayers or manufacturers.
Popular IRA approved gold coins are the Australian Kangaroo Gold Coin series, American Eagle Gold Coins, and Austrian Philharmonic Gold Coins. Silver Britannias can also be added as they feature different weight options as well as rotating designs that change each year. Small bullion bars may also meet certain specifications related to physical weight specifications for eligibility in an IRA account.
Design
Collector coins typically do not qualify for inclusion in IRAs due to their higher cost and collectible nature; these investments tend to serve more as collectibles than pure metal investments. There are some exceptions such as Gold and Silver US Proof coins which have the same metal content, yet are much more visually pleasing than regular bullion coins.
IRAs can invest in precious metals that comply with IRS regulations, but must be stored at an approved depository facility; home storage of precious metals is advised against.
Traditional Individual Retirement Accounts (IRAs) are the most widely held type, while SEP and SIMPLE accounts offer employer-sponsored retirement options. A self-directed IRA gives you more control over its management and investment choices compared to other forms of IRAs.
Taxes
The IRS only permits certain coins and forms of bullion to be held in IRAs, such as gold, silver and platinum bullion that meets certain purity standards; collector coins that adhere to IRS purities standards; small bullion bars meeting manufacturing specifications regarding weight;
IRAs must be held by an IRA custodian, which may be either a bank or federally insured credit union. Due to IRS restrictions, non-IRA assets cannot comele with those from an IRA, so each custodian must uphold an asset segregation policy in order to comply.
IRS officials contended that McNulty’s temporary receipt of AE coins constituted taxable distributions equivalent to their cost. But the Tax Court disagreed, finding that Section 408(m)(3)’s flush language did not require physical possession by trustees for an IRA to own bullion. This decision represents a victory for precious metal enthusiasts looking for ways to diversify their holdings into precious metals investments; to learn more about IRA-eligible coins please reach out.
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