Gold IRA FAQ

What is a Gold IRA?

A Gold IRA, is a special retirement account where you can practically save money for your future by investing in real gold and valuable metals.

Which types of precious metals are eligible for inclusion in a Precious Metals IRA?

A Precious Metals IRA can hold four distinct categories of precious metals: gold, silver, platinum, and palladium. For gold, the IRA is restricted to owning Gold American Eagles (Uncirculated or Proof) or other gold products (coins or bars) in denominations of 1 ounce, ½ ounce, ¼ ounce, and 1/10 ounce, provided they possess a minimum purity level of .995%.

To be eligible for inclusion in an IRA, silver must have a purity of at least .999%, while platinum and palladium must have a minimum purity level of .9995%.

Are a Gold IRA and a gold certificate identical?

No, they are not. A gold certificate is a document that can be exchanged for physical gold. On the other hand, a Gold IRA account involves the direct ownership of physical bullion bars or coins you choose and acquire for your individual retirement account.

Why do I need to transfer or rollover my IRA to purchase gold?

Although it is legally permissible for any IRA to acquire gold and other precious metals, many prominent custodians like Charles Schwab, Merrill Lynch, and JP Morgan Chase do not provide precious physical metals as an investment choice. These traditional custodians are primarily designed to handle paper assets and operate as managed funds.

Investing in physical precious metals is considered a self-directed investment, typically requiring a custodian specializing in self-directed IRA investments. If your current custodian does not offer precious metals as an investment option, we can assist you in initiating a rollover or direct transfer to a custodian that does. It is important to note that a rollover or direct transfer is a non-taxable event.

What are the fees associated with a Precious Metals IRA?

Typically, custodians of Precious Metals IRAs impose several standard fees. These may include an account opening fee, an annual maintenance fee covering statements and filings, and a storage fee.

Additionally, some custodians may require a transaction fee for purchasing metals. It’s important to note that the fee structures can vary significantly among different custodians. For an up-to-date overview of estimated fee schedules from various custodians, you can refer to the active chart provided by Midas Gold Group.

Precious Metals IRAs

Why are the Precious Metals IRA fees higher than a regular IRA?

The larger IRA custodians in the country, such as JP Morgan, TD Ameritrade, Edward Jones, and Merrill Lynch, primarily offer structured financial products like stocks, mutual funds, and CDs.

Many custodians charge minimal or no direct fees for holding such accounts. They generate revenue by selling investment products to their clients. Additionally, banks can earn money by lending out the cash deposited in your IRA due to the fractional reserve banking system.

On the other hand, a self-directed IRA custodian specializing in precious metals does not profit from the assets you own within the IRA. Consequently, they must charge a fee to cover operational costs and provide essential custodial services, including issuing IRA statements.

Moreover, they are responsible for the secure storage of the precious metals, and the associated costs must be passed on to the account holder. Hence, the fees for a Precious Metals IRA are typically higher to ensure the custodian can sustain its operations and meet the requirements of holding physical assets.

Can I deduct the fees for setting up and maintaining my Gold IRA on my taxes?

Absolutely! The fees for setting up and maintaining your Gold IRA are considered tax-deductible expenses.

What’s the difference between an IRA transfer and an IRA rollover?

An IRA transfer is when you move your IRA funds directly from one financial institution (custodian) to another. You sign a transfer form, and the receiving custodian requests the funds from the releasing custodian. This transfer has no tax consequences, as the funds go directly from one custodian to another.

On the other hand, an IRA rollover is typically used when you’re moving funds between different types of accounts, like transferring money from a 401(k) to an IRA. With a rollover, you have two options: direct or indirect. In a direct rollover, the funds move directly from one custodian to another, just like in a transfer. In an indirect rollover, the funds are sent to you, the account holder and you have 60 days to deposit them into another retirement account, like an IRA.

It’s important to complete the indirect rollover within 60 days, or else you’ll be taxed on the funds and possibly face penalties for early withdrawal. This type of rollover is sometimes called a “60-day rollover.” Remember that you can only do one 60-day rollover within a 12-month.

Are the precious metal account fees paid out of my IRA, or do I pay them out of pocket?

You can use the money in your IRA to cover the fees if you’re starting a new IRA or transferring money from another IRA or retirement plan. Another option is to pay the fees using your own money through a check or credit card. Remember, any fees you pay for setting up your IRA can be completely deducted from your taxes.

Do I have to put all my money into my Gold IRA immediately?

No, you don’t have to. After setting up your Gold IRA, you can transfer or move funds from your existing IRA or other retirement plans. You can keep that money in cash until you’re ready to buy gold. You can invest any amount, whether a lot or a little or even invest in other assets instead of keeping it all in cash.

Can I use my ROTH IRA to buy gold?

Absolutely! You can use your ROTH IRA to purchase gold. Just like other types of IRAs, such as traditional IRAs, SEP-IRAs, SIMPLE IRAs, Inherited IRAs, Rollover IRAs, and Spousal IRAs, a ROTH IRA allows you to own gold and other precious metals that are eligible for IRAs.

What is a Silver IRA?

A Silver IRA is a retirement account that allows individuals to invest in physical silver, such as silver coins or bars. It falls under different types of IRAs, including Traditional IRA, ROTH IRA, SEP-IRA, SIMPLE IRA, or Inherited IRA. The account holder has control over the investments and can choose to include both gold and silver in their precious metals IRA.

What is a Palladium IRA?

A Palladium IRA is a type of IRA (Individual Retirement Account) that allows you to invest in specific types of physical palladium coins or palladium bars. It falls under the category of self-directed IRAs or Precious Metals IRAs.

What is a Platinum IRA?

A Platinum IRA is a retirement account where some or all investments are made in Platinum bullion, an approved form of Platinum for IRAs. To have a Platinum IRA, you typically work with a self-directed IRA custodian who helps you set up the account and manage the investments.

I only want to move part of my IRA to precious metals. Can I use only part of my IRA funds?

Certainly! Moving only a portion of your IRA funds to invest in precious metals is possible. Many people do a partial IRA rollover to create a Gold IRA. You can transfer only a specific amount from your IRA or retirement account to a Gold IRA. It’s important to note that individuals can have multiple IRAs and divide their IRA assets among different custodians if they wish to do so.

Can I invest in gold if my IRA custodian doesn’t provide that option?

Yes, you have other choices. You can transfer your IRA to a different custodian who allows investments in gold. Midas Gold Group is a company that works with many of these custodians, and they can assist you in moving your IRA to a new custodian without any taxes. You can initiate as many transfers as you want from one custodian to another.

I have a retirement plan at work. Can I use it to buy gold?

You might have the option to transfer the money from your employer’s plan (such as a 401(k), 403(b), 457(b), or TSP) into an IRA that you control. That’s especially true if you had a savings plan for when you stop working at your previous job, or if you’re stopping work or changing jobs,

With a self-directed IRA, you can use the money to purchase valuable metals like gold.

It’s a good idea to talk to the person who manages it and ask if you can move some of your money to an IRA, if you still work for a company with a retirement plan.

How does it work when you have a Gold IRA and must take out Required Minimum Distributions (RMDs)?

When you have an Individual Retirement Account (IRA) with gold, there is a rule that says you have to start taking out a certain amount of money from the account once you reach 70 ½ years old. These required withdrawals are called Required Minimum Distributions (RMDs).

With a Gold IRA, you have two options for taking your RMDs. The first option is to receive physical precious metals, like gold bars or coins, directly to your doorstep. This is called taking the RMDs “in kind.” The second option is to sell the precious metals and receive the distributions in cash.

Can I keep my IRA precious metals myself?

According to the IRS, you are required to have a trustee or custodian store precious metals owned by your IRA. The trustee or custodian must be a bank, a federally insured credit union, a savings and loan association, or an entity approved by the IRS. This rule is stated in the IRS code (26 U.S. Code § 408).

Some people try to use a “loophole” in the US Tax Code to self-store metals through methods like a “checkbook control IRA,” “LLC IRA,” or “Home Storage IRA.” However, it’s important to note that the IRS has not approved or recognized this practice. Storing your IRA metals at home can put you at risk of IRS penalties. If you choose a custodian offering a Checkbook IRA structure, they usually recommend keeping the metals in a bank safety deposit box.

Do I pay taxes when I transfer into a Gold IRA?

No, you don’t have to pay taxes when you transfer money from an IRA or retirement account to a Gold IRA.

Read more about gold IRA rules and regulations for further transparency.

Are there any metals you cannot include in a Precious Metals IRA?

Yes, certain metals are not allowed in a Precious Metals IRA. The only metals that you can include in a Precious Metals IRA are:

  1. Gold: You can include Gold American Eagles (Proof or Uncirculated) in different sizes such as 1 ounce, ½ ounce, ¼ ounce, and 1/10 ounce. You can also include other gold coins or bars with a minimum purity of 99.5%.
  2. Silver: You can include coins or bars with a minimum purity of 99.9% silver.
  3. Platinum: You can include coins or bars with a minimum purity of 99.95% platinum.
  4. Palladium: You can include coins or bars with a minimum purity of 99.95% palladium.

What if I want to sell my Precious Metals IRA?

You can sell the gold or precious metals in your IRA whenever possible. If you keep the money inside the IRA, there won’t be any taxes or penalties. However, if you take the cash out of your IRA, you’ll have to pay taxes unless your IRA is a ROTH IRA.

What if I want to sell my Precious Metals IRA?

You can sell the gold or precious metals in your IRA whenever possible. If you keep the money inside the IRA, there won’t be any taxes or penalties. However, if you take the cash out of your IRA, you’ll have to pay taxes unless your IRA is a ROTH IRA.

What happens to my Gold IRA when I die?

If you pass away, your Gold IRA and everything it contains will be given to the person or people you choose as beneficiaries. When you open the account, you can decide who these beneficiaries are and change them later if you want to.

Can I put more money into my Precious Metals IRA or move money around?

Absolutely! You can continuously add funds to your Precious Metals IRA. You have the option to transfer money from another IRA or retirement plan. Additionally, you can make yearly contributions to your IRA, depending on the limits specific to your type of IRA and age.

Is my Precious Metals IRA safe, and are my metals protected?

The places where major self-directed IRA custodians store your precious metals have advanced security systems. They have armed security personnel and surveillance cameras to keep everything safe.

Additionally, these facilities have insurance policies from big global insurance companies like Travelers and Lloyd’s of London worth billions of dollars. So, when you pick a trustworthy custodian and storage option, you can be confident that your IRA precious metals are secure.

What are the consequences of not making my annual IRA fee payment?

If you fail to pay your annual IRA, you will incur a late fee. Additionally, suppose you consistently fall behind in your payments. In that case, your custodian may be able to sell a portion of the precious metals held in your account to cover the outstanding fees.

Tim Schmidt

About 

Tim Schmidt is an Entrepreneur who has covered retirement investing since 2012. He started IRA Investing to share his expertise in using his Self-Directed IRA for alternative investments. His views on retirement investing have been highlighted in USA Today, Business Insider, Tech Times, and more. He invested with Goldco.