Gold IRA Rules and Regulations Made Simple

Many novice and even experienced investors experience difficulties trying to understand the process involved in setting up a gold-backed IRA in addition to all the various gold IRA rules and regulations. Hopefully this article will explain in a clear and simple way the basic steps in establishing a gold IRA and the key rules and regulations you will have to comply with to stay within the law.  The best way to do that is to have a quick chat on our homepage. You’re sure to find a reputable Gold IRA provider that fits your circumstances and can quickly and easily walk you through the process.  

By understanding the general rules and regulations surrounding the types of gold and other precious metals you can hold within a precious metals IRA, you can avoid any complications and hassle from the Internal Revenue Service.

So before discussing the general laws surrounding precious metals IRAs, let’s quickly go over the 3 steps involved in establishing a gold IRA.

Process For Setting Up A Gold IRA

Step 1. Open A New Self-Directed IRA

If you already have an existing IRA, you may be able to add various types of precious metals bullion into it. If not, you will have to set up what is known as a self-directed Individual Retirement Account, which will allow you to personally manage how you funds will be invested. When setting up your account, you can also choose what type of self-directed IRA you want it to be. The options available are traditional IRA, Roth IRA, SEP IRA or a Simple IRA.

If you don’t already have your own self-directed IRA, by law you will have use an approved custodian or trustee to create a new one for you. To find the best authorized custodian to suit your particular needs, we recommend using the services of the gold IRA specialists at Regal Assets (1-877-962-1133) who will help you find one. They will also help you with completing all the necessary forms and other mandatory paperwork. If you already manage your own existing IRA, then you may have the option of transferring or ‘rolling over’ your funds from the current custodian to the new one.

Step 2. Selecting Your IRA Investment(s)

Once your transfer has been completed and your new IRA has confirmed receipt of the funds, you will then have to decide what sort of precious metal investments you want to make. Again, the advisors at Regal Assets can assist you with this decision by advising you on what precious metals allocation will be best suited to your particular circumstance and to give you the highest profit, security and portfolio diversification possible. You can see examples of the range of products available here.

Step 3.  Ordering / Purchasing Your Investment(s)

Now that your IRA has been setup and you’ve selected the investment products you want included in your IRA, your new custodian will be notified of your investment preferences via a completed and signed Investment Direction Form (IDF). Once your custodian approves the preferences on this form, you will then be free to place your order for your precious metals with a precious metals dealer like Regal.

In a few days you will receive a confirmation that your order has been successful and your IRA will be complete. As you can see, the whole process of setting up an IRA and diversifying your existing portfolio doesn’t need to be complicated and frustrating.

So now we’ve covered the basic process for setting up an IRA, let’s look at some of the more important rules and regulations governing the use of precious metals IRAs.

Precious Metal IRA Regulations

1. Permitted Metals in IRAs

The Inland Revenue Service or IRS states that collectibles are not permitted as a form of investment. This includes things like works of art, metals, precious stones, antiques, stamps, coins, alcoholic drinks and other physical assets. Given these restrictions, many investors have mistakenly concluded that any form of gold investment is not allowed.

However, under 26 U.S.C. section 408 (m), almost all U.S. minted coins and gold bullion are permitted to be held as an asset in an IRA. It used to be the only coins allowed by the IRS were gold and silver American Eagle coins and bars. But in 1998 they opened it up to include platinum and palladium. Just make sure that before you buy any coins as an investment that is on the allowable product list.

Here is a quick summary of the more popular and well-known products.

Gold: American Eagle Coins, Austrian Philharmonic coins, Canadian Maple Leaf coins, PAMP Suisse bars, US Buffalo uncirculated coins, bars and rounds.

Silver: American Eagle coins, Austrian Philharmonic coins, Canadian Maple Leaf coins, bars and rounds.

Platinum: American Eagle coins, Canadian Maple Leaf coins, Isle of Man Noble coins, bars and rounds.

Palladium: Bars and rounds.

2. Investment Choices

Whilst not being classed as a collectible is a key requirement, there are a few more quality-specific criteria that a particular precious metal product must comply with before it can be permitted as an investment.

They are as follows:

Minimum purity or ‘fineness’ required for precious metal bars are: Gold (.995+), Silver (.999+), Platinum (.9995+) and Palladium (.9995+);

All bars and rounds should be produced by a known manufacturer that has been accredited by Nymex/Comex , LBMA, LME, NYSE/Liffe/CBOT, and ISE-9000 or a national mint;

Any coins that have undergone certification are not permitted.

You can view a list of all the precious metals that have passed these criteria here.

3. Custodial Maintenance

The final IRS restriction placed on investors holding precious metals in IRAs is that it is prohibited to take personal possession of the purchased assets. What this essentially means is that you can’t purchase precious metals for your IRA, get it delivered to your house and store it on your personal safe. You must keep your precious metals in an independent personal metal depository or you will be liable to pay tax on your purchase. You can read more about the tax rules concerning IRAs and the holding of precious metals here.

Even with all these rules and regulations, gold is still one of the most attractive investment options available on the market. It’s relative stability when compared to the more traditional paper-based investments like stocks, bonds, mutual funds and currencies means that it is always in demand by investors looking for a way to diversify their existing portfolios.

If you’re looking to find a gold ira provider you can trust, and has expertise in your particular situation, have a quick chat on our home page.  You’re sure to find highly competent company that is tailored to your specific needs.