Investing in Precious Metals in an IRA: Restrictions and Guidelines

Investing in precious metals can be a great way to diversify your retirement portfolio and hedge against certain financial risks. However, there are certain restrictions and guidelines that you should be aware of before investing in gold or other precious metals in an IRA. The IRS allows you to deposit funds into an IRA by transferring the full or partial amount from another tax-advantaged account, such as a 401(k). Equity Trust will facilitate this process by following your instructions.

It's recommended to keep only a small portion of your retirement assets in gold IRAs, as using an IRA to invest in precious metal assets becomes especially problematic when you are at or near retirement age. Many IRA holders use what they believe to be a “loophole” in the U. S. Tax Code, which allows the account holder to store metals on their own using a “checkbook control IRA”, an LLC IRA, or a “home storage IRA”. Self-directed account custodians don't provide investment advice, but they do offer administrative and reporting services, and they will purchase precious metals on your behalf following your instructions through your IRA account.

Physical precious metals are a self-directed investment and generally require a custodian who offers self-directed IRA investments. However, most major custodians, such as Charles Schwab, Merrill Lynch and JP Morgan Chase, don't offer physical precious metals as an investment option. You can find trustees willing to do so through an Internet search and they will be responsible for the physical storage of precious metal assets owned by IRAs. The IRS requires that precious metals owned by an IRA be stored in the possession of a trustee or custodian. IRA holders are allowed to use the funds in their IRA account to purchase precious metals approved since 1998, following the passage of the Taxpayer Assistance Act of 1997. A ROTH IRA can own IRA-eligible gold and precious metals like any other IRA, including a traditional IRA, a SIMPLE IRA, an inherited IRA, a cumulative IRA, and a spousal IRA. A platinum IRA is an IRA in which some of your assets are invested in forms of platinum ingots approved by the IRA. You can trade, transfer, swap, or sell your IRA's precious metals at any time with no tax implications.

You can also choose to re-sell your metals to an authorized dealer and the cash received will be returned to your IRA.