A self-directed precious metal IRA is a great option for many investors. It offers freedom, flexibility, and the ability to withdraw the bullion from the IRA for distribution. A Gold IRA is also considered an effective way to add diversity to a portfolio and to allow you to choose how to invest and withdraw to maximize your tax benefits.
There are specific rules and requirements for precious metals in IRAs. Choosing a top precious metal IRA company is the best way to ensure full compliance with all IRA rules and regulations.
IRAs Cannot Hold Collectibles
Any type of precious metals in IRAs cannot be classified as collectibles. In other words, it is only possible to hold coins that are considered legal tender and have a fineness level of 99.5%.
This requirement rules out many coins from other government mints, although there are coins from other countries, including Canada, that can qualify. In general, older US coins do not meet the fineness level of 99.5%, which means they cannot be held in the IRA despite their value and being a US coin.
Cannot Be Currently Owned by the IRA Holder
If you are an investor currently holding gold or precious metals, you cannot transfer those coins or bullion as precious metals in IRAs. This would violate the requirements that the owner of the IRA is not a seller or a buyer of precious metals.
Instead, the IRA owner uses a custodian, an approved third party, to manage the purchase and sale of any gold or precious metals that are being used in the IRA.
