Can You Take Physical Possession of a Gold IRA?

Can You Take Physical Possession of a Gold IRA?

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Investing in your retirement is a priority for everyone. Many people looking to broaden their investments take advantage of gold IRAs to invest in precious metals as part of their retirement savings.

For those who invest in precious metals, a common question is if they can keep their precious metals at home instead of storing them at an IRS-approved facility. The answer to this question is a bit complicated. It is important to look at what defines a gold IRA and what rules are associated with possessing the assets that are part of the account.

Can You Take Physical Possession of a Gold IRA?

What Is A Gold IRA?

In 1974 Congress passed the Employee Retirement Income Security Act (ERISA) that allowed individuals to establish an Individual Retirement Account (IRA) to save for retirement. This was a result of changes throughout many industries in canceling pension plans.

These IRAs only allowed people to invest in the stock market. In 1997, the Taxpayer Relief Plan was passed by Congress, changing what can be held in a retirement account. Now, due to the changes made through this congressional bill, individuals could hold gold, silver, platinum, and palladium as part of their retirement accounts.

Part of the new regulations required that any precious metals held in a retirement account meet specific purity standards and come from approved mints. Gold coins and bars must be 99.5 percent pure (Except the American Gold Eagle), silver must be 99.9 percent pure, and platinum and palladium must meet 99.95 percent purity standards.

Additionally, the Internal revenue Service (IRS) set standards on how precious metals could be considered part of a retirement account. The IRS will allow you to hold your precious metals if, and ONLY if, you meet all of their standards. Otherwise, your precious metal assets must be held in an approved storage facility.

Can You Take Physical Possession of a Gold IRA?

The Big Question - Can You Store Your Precious Metal Investments?

The blunt answer to this question is no. There is only one exception to the rule, and it is a complex set of rules and standards that you must be in 100 percent compliance with or face large tax penalties.

If you are really set on storing your precious metals that are being held as part of your retirement savings, you will need to meet the following IRS standards:

  • An LLC (limited liability company) must be established in your name. The LLC must have the specific intent of providing storage for the precious metals.
  • You must have a personal net worth of at least $250,000 - not including the value of the LLC or any other business.
  • The LLC ownership cannot be held just by the IRA holder. The LLC must be owned by several individuals.
  • Each company owner must have a $250,000 fidelity bond as their personal, corporate insurance.
  • You must meet all of the experience and background checks placed by the IRS.
  • The business must have a physical location outside the individual's home that is open to the public for business.
  • Yearly audits must be submitted by a certified accountant to the IRS.
  • The business must always have a lawyer on retainer.

As you can see, it is nearly impossible for an individual to meet all of these requirements. And you must meet all of these requirements or face large penalties.

Even if you can meet all of these requirements, it still may be beneficial to have your precious metals stored at an IRS-approved storage facility. This can ensure that your metals are safe and that you are always in compliance with the rules of the IRS.

Penalties For Self- Storage

If you decide that you want to invest in precious metals and store these assets in your personal safe without complying with the IRS guidelines, you are taking a very big risk.

First, an IRA gives you special tax deferred status on your retirement savings You can regulate how much you actually pay in taxes when you begin to withdraw from your retirement account. However, if you are holding the precious metals at home and do not meet the IRS standards for doing this, you will have to pay all of the taxes at once. In addition, you will pay penalties for early withdrawal from your account if you are not of age to have possession of money from your retirement account. You may also face additional fines for breaking these regulations.

All of these potential penalties and fines do not make it worth your time or effort to hold your precious metals at home for your retirement account. The best thing you can do is hold your precious metals in an IRS-approved storage facility. If you want to have precious metal coins or bars at home, purchase them as a collector.

Can You Take Physical Possession of a Gold IRA?

Some Companies Are Advertising You Can Hold Your Gold At Home

In the last few years, a few companies have been advertising that they can send your gold and other precious metals to you for home storage. They offer many benefits that all genuine gold brokers are not offering. This should sound warning bells.

Any company that is actively telling you that you can use home storage of your precious metals that are part of your IRA is being deceptive. Avoid these companies so that you can avoid the problems that this will cause.

As you have read, many standards must be met for you to hold your own precious metals that are part of your IRA. You will face severe penalties and fines if you do not comply with every standard.

Can You Take Physical Possession of a Gold IRA?

What Are IRS-Approved Storage Facilities?

There are several IRS-approved depositories across the United States. Some of the most commonly used storage facilities include:

  • The Delaware Depository
  • Brinks Global Services
  • JPMorgan Chase Bank NA
  • HSBC Bank USA
  • CNT Depository
  • International Depository Services

There is also an IRS-approved depository in Singapore.

These depositories may store your precious metals in common storage or in segregated storage. Common storage means that all of the precious metals are held in one area without distinction of ownership. A segregated storage facility will keep your precious metals in their own space.

Storage facilities have different fees associated with them. It is important to shop around for the best deal. Some facilities charge a flat fee and will ask you to purchase additional insurance. Some facilities include an insurance policy as part of their price. Facilities that bulk store precious metals are less expensive than those that offer segregated storage.

The gold IRA company that you work with may have deals arranged with a specific storage company that can help you secure the best storage price. Some companies will even cover the storage fee for one or more years based on your initial investment. Make sure that you request information about the storage services your gold IRA company offers.

Can You Take Physical Possession of a Gold IRA?

When Can I Make Withdrawals From My Gold IRA?

Current guidelines set by the IRS for IRA withdrawals, you can begin to make withdrawals from your retirement account at age 59.5. This applies to all IRAs, not just gold or self-directed IRAs.

The IRS requires that you begin to take out a minimum monthly amount when you reach the age of 72. If you were born before July 1, 1949, the age is 70.5 for minimum monthly withdrawals. The amount of your withdrawal will be based on several factors.

When you begin to withdraw from your gold IRA, you can sell the precious metals for their current cash value, or you can take physical possession of the coins and bars at that time.

It is important to understand that making early withdrawals from any IRA will come with a penalty. The average penalty is 10 percent. This can change, so it is important to inquire about the penalty if you withdraw before your retirement age.

These Are Our Top 3 Recommended Companies:

#1

Augusta Precious Metals was established in 2012 and is located in Casper, Wyoming. The company offers gold and silver IRAs. They currently manage over $12 billion in assets. The company only offers gold and silver coins and bullion. They work with three different companies to manage your IRAs so you can choose which one meets your needs. They also work with an IRS-approved storage facility that comes with a Lloyd of London insurance policy. Augusta Precious Metals has an A+ rating with the Better Business Bureau and continually receives high ratings for its customer service. The only drawback of investing with Augusta Precious Metals is that they require a minimum of $50,000 to establish an account.

Goldco is a Los Angeles-based gold company that has been in business for over a decade. The company was founded with the intent of helping people establish self-directed IRAs using gold or silver as an investment. Goldco has continually ranked high with its reviews for providing exceptional customer service, great educational materials, and a large variety of coins and bars to select from for investment. Goldco will help you establish a gold or silver IRA and make the initial investments into precious metals. They can roll over your current IRA or help you establish a new account.

American Hartford Gold is a leading provider of gold IRAs. The company has been in business for over 10 years and currently manages over $75 million in assets. They offer the most diverse options for precious metal investing, including platinum and palladium The company also offers many specials for free silver when you establish an account. They continually rank high in reviews on Trustpilot and the Better Business Bureau. In addition to helping you establish a self-directed IRA, the company provides exceptional educational material so that investors can make an informed decision about all of their investments.

One Last Thought

Investing in gold and other approved precious metals is a great way to diversify your retirement savings. The stock and bond market can fluctuate without warning, and precious metals will give your account some much-needed stability. While all investments can fluctuate in value, precious metals have performed much better for stability.

Investing in gold and other precious metals requires establishing a gold IRA. A self-directed IRA is a retirement account that allows you to hold precious metals as part of your retirement savings.

It would be best to store your precious metals in an IRS-approved storage facility. This not only keeps your assets safe but also protects you from fines and penalties by the IRS for not having your retirement assets secured in accordance with the law.

The last thing to remember is to work with a reputable gold IRA company. We believe that you will benefit from reviewing what the above three companies have to offer.