The IRS allows you to purchase various coins for storage within a self-directed individual retirement account (SDIRA). They understand gold coins physically stand the test of time and benefit from a strong market.
The Taxpayer Relief Act of 1997 broadened the range of gold coins that can be added to a SDIRA. For instance, gold coins for IRAs must possess a minimum purity of 99.5% gold and be considered as acceptable legal tender.
It is important to ensure that the gold purchased consists of coins that have been produced and backed by a government body, such as the United States or Canadian governments. These governments provide assurance regarding the quantity and quality of the metal content in the coins. Additionally, they guarantee the face value of the coins, which may vary significantly based on their weight and design.
IRA-Approved Gold Coins
Most investors can purchase the following gold coins that are approved by the IRA for inclusion in a gold IRA.
MOOSE GOLD BULLION COINS
Other details of the Moose Gold Bullion Coin, which started production in 2022 as the Animal Portrait Series’ sixth release by the Royal Canadian Mint, include that it is a must-have for those who appreciate animals, nature, and art.
- Reverse-side detail featuring a bull moose
- Right profile of the British monarch on the opposite side
GREAT-HORNED OWL GOLD BULLION COINS
Highlighted features of the Great-Horned Owl Gold Bullion Coin consist of its 2021 dating and origin from the Royal Canadian Mint.
- Reverse-proof specimens
- ¼ Troy ounce of .9999 pure gold
- Face value of $10 (CAD)
- Obverse side profile of Queen Elizabeth II
- Stunning owl design on the reverse side
WOODLAND CARIBOU BULLION COINS
The reverse side of the Woodland Caribou Bullion Coins showcases the stunning woodland Caribou. These Canadian Gold Proof Coins, minted in 2020 by the Royal Canadian Mint, can be acquired with protective plastic flips, mint tubes, or Monster Boxes containing 800 coins. Every coin presents frosted background fields and mirrored design elements.
CANADIAN WILD HORSE BULLION COINS
Having the majestic Canadian Wild Horse on their reverse side, the Canadian Wild Horse Gold Bullion Coins were introduced into circulation in 2019 as a creation of the Royal Canadian Mint. Additional characteristics incorporate:
- 99.99% pure gold
- Obverse right profile of the British monarch
WOLVERINE GOLD BULLION COINS
In 2018, the Royal Canadian Mint released the Wolverine Gold Bullion Coin, which showcases a captivating wolverine portrait on its reverse side. This coin, crafted from .9999 fine gold, ranks among the highest purity available in the market.
BIGHORN SHEEP GOLD BULLION COINS
Minted in 2017, the Bighorn Sheep Gold Bullion Coin by Canadian artist Denis Mayer originates from the Royal Canadian Mint. It showcases Queen Elizabeth II on the front side, and consists of pure gold with a fineness of 99.99%.
AMERICAN GOLD EAGLE BULLION COINS
Since its initial release in 1986, the American Gold Eagle Bullion Coin from the U.S. Mint has consistently been a favored choice among gold collectors for investment purposes. This coin is highly regarded globally and holds the distinction of being minted solely from gold sourced within the United States, meeting the standards set by the IRS.
AMERICAN GOLD EAGLE PROOF COINS
The American Gold Eagle Proof Coin, introduced by the U.S. Government in 1986, is the only coin of this type that may be used for IRAs. This coin has a unique mirror-like finish thanks to a special minting process with planchets.
CANADIAN $10 GOLD POLAR BEAR AND CUB
The IRS has approved the Canadian $10 Gold Polar Bear and Cub Coin, which is made of 99.99% pure gold, for inclusion in self-directed IRAs or Gold IRAs. This quarter-ounce coin showcases a breathtaking design of a Polar Bear in its natural habitat.
AMERICAN BUFFALO COINS
The American Buffalo Coin, introduced in 2006, is an affordable investment option for those looking to begin their journey in gold bullion coins, available at a face value of $50.
AMERICAN BUFFALO PROOF COINS
Similar to the American Buffalo Coin, the 2006-W $50 Proof coin was produced in West Point and possesses a reflective appearance attributable to its distinctive minting technique.
AUSTRIAN GOLD PHILHARMONIC COINS
According to the World Gold Council, the Austrian Gold Philharmonic Bullion Coins, which were first minted in 1989, achieved the status of being the top-selling gold coins worldwide in 1992, 1995, and 1996. These coins are composed of 1 ounce of .9999 fine gold and possess a 100 Euro denomination.
CANADIAN GOLD MAPLE LEAF COINS
The Canadian Gold Maple Leaf Coin, which was first minted by the Royal Canadian Mint in 1979, is one of Canada’s most popular gold coins. Composed of 24-karat gold, this coin contains approximately 99.99% pure gold and has received IRS approval for self-directed IRAs or Gold IRAs.
How to Buy Gold Coins for Your IRA
In order to purchase gold coins approved by IRA for your retirement account, the first step is to find a gold IRA custodian who will hold your assets. Afterwards, you can proceed to establish a gold IRA account. It is possible to contribute funds to your account and acquire gold by transferring them from an already existing account.
When You Can And Can’t Own Gold In An IRA
During the summer, as the price of gold reached unprecedented levels, you likely encountered several advertisements suggesting gold investment through an IRA. It is important to note that gold is considered a “collectible,” and it is prohibited for IRAs to possess collectibles.
Both of those ideas are accurate. Gold can be considered a collectible, but there are legal methods to possess gold through an IRA.
There are certain forms of gold, silver, platinum, and palladium that can be owned by an IRA, despite the general rule that an IRA is not permitted to own collectibles such as precious metals in the form of bullion or coins.
IRAs can possess legal tender bullion coins, which must have a fineness level of 99.5%. The American Eagle coins, along with certain state-issued bullion coins, meet the criteria. Canadian Maple Leafs are eligible for IRAs as well. However, South African Krugerrands and British Sovereign coins are not included in the exception. Additionally, older U.S. coins like Double Eagles are not qualified for IRAs.
If the gold and silver bullion bars and rounds possess a fineness of 99.9%, they can be included in an IRA. This typically requires the source of production to be a refinery approved by NYMEX or COMEX, or a government mint of a nation.
You are generally not permitted to hold gold in most IRA custodians. These custodians solely permit investments in publicly-traded assets like stocks, bonds, mutual funds, and potentially options and futures.
In order to possess gold in an IRA, whether in the form of coins or bullion, it is necessary to have a genuine self-directed IRA provided by a limited number of custodians. The possession of coins or bullion by the custodian is mandated by the IRS regulations, thus preventing the utilization of IRA funds for the purchase of metals to be stored independently. An IRS-approved custodian is indispensable in this scenario.
It is not permissible to transfer coins or bullion that you already possess into your IRA. This action is considered a prohibited transaction, as IRA owners are not permitted to engage in buying or selling activities with their IRA.
To discover custodians providing genuine self-directed IRAs, conduct an online search using keywords like “gold IRAs” or “self-directed IRAs.” It is important to conduct a meticulous search, taking special note of their business tenure, the fees imposed, and their methods of purchasing coins or bullion for your IRA.
Make sure to seek a custodian who will secure you a favorable deal without imposing an exorbitant markup or margin. Additionally, ensure that you are aware of the applicable storage and insurance fees, along with any charges pertaining to other transactions or services.
While the custodian will provide assistance, it is ultimately up to you to ensure that any coins or bullion bought for the IRA adhere to the IRS’s regulations.
Upon completing this research, it is likely that you will come to the conclusion that gold or bullion and coins should not be held in your IRA. If your intention is to profit from a rise in the price of gold, it is more advantageous to possess an exchange-traded fund (ETF). The ETF can be purchased and sold at any time when the markets are open. Furthermore, the ETF is capable of acquiring, storing, and insuring gold at a significantly lower cost compared to you or an IRA custodian. Notably, the IRS has issued Private Letter Rulings to the prominent gold ETFs confirming the permissibility of IRA ownership. To obtain more information, you can refer to the “Tax Risks” section of one of the ETFs’ prospectus.
Investing in gold or silver through holding coins or bullion is not an effective method. Individuals who worry about a potential currency collapse usually opt for coins or bullion as an alternative form of currency for convenience. If your objective is to safeguard against currency collapse, it is preferable to possess or keep gold nearby rather than owning it through an IRA. It is recommended to hold it outside the scope of an IRA.
The LLC IRA or Super IRA is often suggested by certain individuals. Essentially, this entails establishing a genuine self-directed IRA with a custodian. By forming an LLC with the IRA as its investor, this framework allows for the circumvention of various fees enforced by the custodian. This occurs as transactions are conducted by the LLC through a standard brokerage or checking account, rather than through the custodian.
However, do not utilize this framework as a means for an IRA to invest in gold or silver because the IRS requires precious metals to be held by a custodian. If the LLC buys them and you retain custody, it is highly probable that this would be considered a prohibited transaction or investment.
All types of IRAs, such as traditional, Roth, SEP, and SIMPLE, as well as other retirement accounts like solo 401(k)s, are subject to these rules.
Although it is permissible to possess gold or silver within an IRA or another retirement account, there are certain limitations, making it suboptimal and less efficient for owning these valuable metals. It could be more advantageous to consider investing the IRA funds in a precious metals ETF or possessing precious metals in a taxable account.