No idea what is IRA eligible gold? Answering this question is the first step to diversifying your retirement savings.
Opening a gold IRA is relatively simple, especially after finding a trustworthy gold IRA company and a custodian.
However, not all gold is made equal, and the IRS has specific rules regarding what precious metals you can keep in your IRA.
This guide will explore IRA-eligible gold and how you can get your hands on coins, bars, and bullion.
From there, you can build a diverse portfolio to help you protect your retirement investments against economic uncertainty and inflation.
- What Is the Difference Between IRA and Non-IRA-Eligible Gold?
- What Is IRA Eligible Gold?
- Requirements for Other IRA-Eligible Precious Metals
- What Are Some Examples of IRA-Approved Gold?
- How Can I Find IRA-Eligible Gold?
- How Can I Store IRA-Eligible Gold?
- Things to Know Before Buying IRA-Eligible Gold
- It’s All About Purity
What Is the Difference Between IRA and Non-IRA-Eligible Gold?
When you start looking into investing in gold, you are going to notice most companies recommend investing in IRA-eligible gold.
Compared to non-IRA physical gold, these precious metals meet the exact specifications laid out by the IRS.
With these regulations in place, you can guarantee your retirement savings will remain valuable for considerably longer.
Another essential difference between IRA-eligible and non-IRA gold is its legitimacy.
When you buy approved precious metals, you’re confident they are from accredited manufacturers.
As such, you can guarantee the product’s authenticity, which can be turned into a lifelong investment.
What Is IRA Eligible Gold?
The definition of IRA-eligible gold is relatively straightforward in that it includes all precious metals that meet the IRS’ standards.
You can then invest in the metals through your self-directed IRA by meeting these standards.
With this type of individual retirement account, you can purchase an assortment of precious metals such as gold, silver, palladium, and platinum.
To better understand IRA-eligible gold, it’s important to note the IRS’ requirements. Let’s look at the specifications for coins, bars, and rounds.
Precious Metal Coins
Precious metal coins must be at least 99.5% pure to be put into a self-directed IRA, according to the IRS.
It’s also important to note that the majority of collectible coins are excluded from being IRA-eligible.
The coins’ general quality must also be considered, such as how they are received from the manufacturer.
Proof coins must be in mint condition and arrive with a certificate of authenticity before being allowed into an IRA. Also, they have to be encapsulated in their original packaging.
If you’re investing in non-proof coins, they must be uncirculated and classified as “brilliant.”
Currently, there are two coins approved to be used in your gold IRA:
- American Gold Buffalo
- American Eagle
Bars and Rounds
If you intend to put gold bars or rounds into your self-directed IRA, they must also meet specific requirements.
The gold must be from a certified or accredited source. Alternatively, they can be purchased from a national government mint.
There is a minimum fineness requirement gold bars must meet, such as a 99.5% purity rating.
Additionally, bullion bars have to meet their exact weight specifications during manufacturing.
Requirements for Other IRA-Eligible Precious Metals
You will most likely invest in gold once you open your first gold IRA. However, there’s also the opportunity to buy silver, palladium, and platinum to hold your retirement savings.
Like gold, there are also specific requirements that these additional metals need to meet, including:
Like gold, silver purchased for your IRA must be manufactured by an accredited refiner or a government mint.
Additionally, each silver product must have a .999 and no lower fineness rating. Regarding purity, silver coins and bars must be 99.9% pure.
Platinum is an expensive metal, and as such, it can be a beneficial way to grow your retirement over time.
That said, it still applies to the same standards as gold and silver. The main difference is that platinum can be 99.95% pure to be IRA-eligible.
The last option to consider for your precious metals IRA is palladium.
As a relatively rare material, it is often treated the same as platinum when it comes to fineness and manufacturing requirements.
You will be required to have palladium at 99.95% purity for it to be invested in a gold IRA.
What Are Some Examples of IRA-Approved Gold?
It’s important to note that although most gold coins cannot be held in your IRA due to their collectible status, many others can.
Fortunately, there is an assortment of gold, silver, platinum, and palladium coins to consider for your savings.
Let’s take a quick look at some of the more popular options you’ll find on the market.
IRA-Approved Gold Bullion
- American Gold Eagle
- American Gold Buffalo
- Australian Gold Kangaroo
- Canadian Gold Maple Leaf
- Royal Canadian Mint Gold Bars
- Valcambi Gold Bars
- Credit Suisse Gold Bars
IRA-Approved Silver Bullion
- Chinese Silver Panda Coins
- Silver Britannia Coins
- Austrian Silver Philharmonic Coins
- Johnson Matthey Silver Bars
- Sunshine Mint Silver Rounds
IRA-Approved Platinum Bullion
- American Eagle Platinum Coins
- Australian Koala Platinum Coins
- Isle of Man Platinum Coins
IRA-Approved Palladium Bullion
- Canadian Maple Leaf Palladium Coins
- American Eagle Palladium Coins
- Credit Suisse Palladium Bullion Bars
How Can I Find IRA-Eligible Gold?
Although there are strict requirements to be met when investing in metals for your IRA, finding the right ones is relatively simple.
Most top-tier gold IRA companies will only work with IRA-eligible gold approved by the IRS.
These companies will work with the best sellers on the market, ensuring you only have access to metals that will be accepted into your IRA.
That said, all you have to do is browse for and buy gold as you normally would.
It helps to remove the headache of trying to match fineness with purity, along with the other IRS-set standards for precious metals.
Once you’ve found the perfect type of metal you want to invest in, there are a couple of additional steps you will need to take.
As expected, the IRS has additional requirements to follow after you purchase IRA-approved gold.
For instance, you will need to find adequate storage for your new investment, which is something many investors forget.
How Can I Store IRA-Eligible Gold?
Keeping your investment within arm’s reach can be tempting, especially when investing in a tangible product.
Many gold owners prefer keeping the gold in their homes, but the IRS does not allow this for gold IRA investments.
You will require professional, off-site storage if you are buying precious metals using your IRA.
Much like ensuring the quality of your gold, your gold IRA company will likely provide storage recommendations.
If they don’t, your custodian will surely have a list of potential storage facilities to fulfill your needs.
Without adequate storage, you won’t be able to invest in any type of precious metal using your IRA.
Why Can’t I Store My Gold At Home?
There are many reasons why storing your IRA-approved gold at home is impossible, as per the regulations of the IRS.
Firstly, there is no way for the IRS to confirm the gold is insured, especially if kept at home.
Even if you want to put it in a safety deposit box in a credit union, the IRS cannot guarantee the safety of your investments.
Another fundamental reason you can’t keep physical possession of IRA-approved gold at home is that it can be tempting to use.
As with most retirement accounts, tax penalties are associated with withdrawing your gold early for spending.
If you were to keep your gold at home, you could avoid these penalties set by the IRS.
What Are the Storage Requirements for IRA-Eligible Gold?
Now that you clearly understand why you cannot store your IRA-approved gold at home, it’s time to consider where it can go.
Most custodians work with top-of-the-line facilities that offer remarkable storage solutions, regardless of the size of your investment.
One of the most popular locations is the Delaware Depository, although there are many other storage facilities nationwide.
When choosing storage for your IRA gold, you will want to ensure the facility has hefty insurance coverage.
Also, they should have a top-tier security system to protect your investment.
It’s important to note that all IRS-approved depositories meet extremely strict standards and are bound to impress with their elevated security.
Things to Know Before Buying IRA-Eligible Gold
It’s easy to see how IRA-eligible gold can be a fantastic investment for most.
Before you get started with opening an account, let’s go over a few additional tips you should know.
When opening a gold IRA for the first time, you must know that there are IRS regulations on how much you can contribute annually.
For 2022, the contributions are capped at $6,000 annually, the same as 2021. If you are 50+ years old, you can contribute up to $7,000 per year.
Like any other investment account, opening a gold IRA will likely come with additional fees.
However, most gold IRA companies offer waived fees if you invest over $50,000 in your accounts.
Some extra fees you could be responsible for include maintenance, account opening, storage, and seller fees.
Every prospective IRA owner must know another essential point: the minimum investment for their account.
Most gold IRA companies require you to put a certain amount into your IRA to start. These totals can be anywhere from $20,000 to $50,000.
It’s best to avoid penalties at all costs to make the most of your investment. With your IRA, there are early withdrawal penalties of 10% under the age of 59.5.
There are a couple of exceptions, but it’s important to confirm the best way to liquidate your investments if necessary.
It’s All About Purity
When trying to figure out what is IRA eligible gold, the most important things to consider are purity and manufacturing standards.
As long as the IRS has previously approved the specific type of gold coin or bar you are looking to purchase, it should be IRA-eligible.
It is essential to always confirm the quality of any precious metal before putting your retirement savings into its purchase.