Investing in precious metals is a worthwhile goal for everyone looking to live comfortably in retirement. New investors make the fatal mistake of thinking they can buy every type of precious metal for their IRA account. But the truth is quite different. Only certain types of gold, silver, platinum, or palladium are acceptable in a precious metals IRA.
How can investors and future retirees tell the difference between acceptable and unacceptable precious metals? First, they must learn the rules regarding IRA approved gold and other investments.
Once they learn the truth, everything else will quickly fall into place. And before long, you’ll have no trouble buying the best gold, silver, platinum, and palladium investments for your self-directed IRA.
Precious Metals IRA Rules & Regulations from the IRS
At one point not that long ago, precious metals IRAs had very strict limits. In fact, investors were only allowed to own American Eagle silver and gold coins. But things have changed since then. And now there are many more IRA approved precious metals for investors to choose from.
What happened? Well, a tax reduction act called the Taxpayer Relief Act of 1997 made a big difference for investors. In this act, the IRS expanded the allowable precious metals holdings in a gold IRA.
They also expanded the size options to 1/10, 1/4, 1/2, and 1-ounce sizes. This granted investors permission to add many different US gold and silver coins, plus many foreign coins to their portfolio.
But there are certain qualifications that must be met to achieve precious metals IRA approval. Specifically, approval will only be met if the coins, rounds, and bars meet certain minimum fineness requirements. Those requirements include:
- Mandatory purity levels – gold must maintain 99.5% purity, silver must maintain 99.9% purity, and platinum and palladium must maintain 99.95% purity
- Coins, bars, and rounds – each of these investments are only allowed if they are produced by an accredited or certified national government mint, COMEX, LPPM, NYSE/Liffe, NYMEX, LME, ISO 9000, LBMA, or TOCOM. And the investments must meet the minimum fineness requirement.
- Proof coins – each coin must have a certificate of authenticity, it must remain in excellent condition and it must be enclosed in the original mint packaging.
- Small bullion bars – these bars must be manufactured based on the exact specifications of weight, excluding 400-ounce gold, 1000-ounce silver, 100-ounce palladium, 100-ounce gold, and 50-ounce platinum bars.
- Non-proof bullion coins – each coin must not have any damage on it whatsoever and it must maintain a brilliant uncirculated condition.
Gold Coins and Bars with IRA Approval
- Gold American Eagle coin
- Gold Canadian Maple Leaf coin
- Gold Austrian Philharmonic coin
- Gold Chinese Panda coin
- Gold Mexican Libertad coin
- Gold British Britannia coin
- Gold Australian Kangaroo/Nugget coin
- Gold American Buffalo coin
- 1-ounce Credit Suisse gold bar
- 1-ounce Perth Mint gold bar
- 1 g Valcambi gold bar
- 1 g PAMP Suisse gold bar
Silver Coins, Rounds and Bars with IRA Approval
- Silver American Eagle coin
- Silver Burnished American Eagle coin
- Silver Australian Kookaburra coin
- Silver Austrian Philharmonic coin
- Silver Chinese Panda coin
- Silver Australian Koala coin
- Silver Armenia Noah’s Ark coin
- 1-ounce silver round
- 1-ounce PAMP Suisse silver bar
- 10-ounce silver round 10 ounce
- 10-ounce silver bar Morgan Design
Platinum Coins and Bars with IRA Approval (With Company Approval)
- Platinum American Eagle coin
- Platinum American Eagle Proof coin
- Platinum Burnished American Eagle coin
- Platinum Australian Platypus coin
- Platinum Australian Koala coin
- Platinum Canadian Maple Leaf coin
- 1-ounce platinum Englehard bar
- 10-ounce platinum PAMP Suisse bar
- 1-ounce platinum Credit Suisse bar
- 1-ounce platinum Valcambi bar
Palladium Coins and Bars with IRA Approval (With Company Approval)
- Palladium Canadian Maple Leaf coin
- Palladium Russian Ballerina coin
- 1-ounce Credit Suisse Palladium bar
- 1-ounce PAMP Suisse Palladium bar
Some companies do not offer platinum or palladium investments through their service. Keep this in mind in case you intend to purchase platinum and palladium investments for your precious metals IRA.
Beware of Collectible Coins: Collector Coins, Numismatic Coins, and Semi-Numismatic Coins
Whether you know it or not, investors aren’t allowed to hold rare or collectible coins in their precious metals IRAaccount. This may seem unfair, but rarity has nothing to do with the guidelines set forth by the IRS.
Although, there is one major exception to the rule. One type of numismatic coin is allowed in a precious metals IRA. The type of coin is called a US Proof Coin. Certain numismatic US Proof Coins made of gold and silver are permissible in a precious metals IRA account.
But I would recommend steering clear of them because numismatic coins are more expensive than typical precious metals coins. The major difference is that a proof coin looks nicer than your typical gold or silver coin. But that isn’t reason enough to pay a premium or serious markup in my opinion.
Although, if you buy US Proof Coins for your gold IRA, it’s allowed because it’s considered IRA approved precious metals. The silver and gold content are the same amount and purity level of other coins. Again, the only major difference is the attractiveness of the coin’s overall appearance.
More often than not, numismatic and semi-numismatic coins do not meet the purity requirements that the IRS demands. And because of this fact, these coins aren’t considered a reliable or welcome investment in a gold IRA account.
Ineligible Precious Metals IRA Bullion Coins That Are Really Popular
Just because it isn’t allowed in a gold IRA, it doesn’t mean that a coin isn’t popular. Some coins just fail to meet the requirements set out by the IRS. Even so, these popular coins will never receive IRA approval unless they change their purity levels in the future.
Some extremely popular coins that are not considered IRA approved precious metals include:
- Russia’s George the Victorious coin
- British Britannia coin (pre-2013)
- United Kingdom Sovereign coin
- Israel Tower of David coin
- USSR Chevronet coin
- Chilean 100 Peso
- South African Krugerrand coin
- South African Krugerrand coin
- Mexican 50 Peso
- Italian Lira coin
- Swiss 20 Franc
- Somalia Elephant coin
- Switzerland Vreneli coin
- Austrian Corona
- French 20 Franc
- U.S. Liberty coin
- Dutch 10 Guilder
- U.S. Buffalo Proof coin
- French Napoleon coin
- Mexican Gold Peso coin
Precious Metals IRA FAQ
If you’re new to investing in precious metals, you undoubtedly have many questions that need answers. You can continue floundering and stumbling your way through the learning process. But I felt it best to provide a handy FAQ to my readers. Hopefully you’ll find invaluable answers to your most pressing questions about this topic.
Why Do I Need to Store My Precious Metals in a Secured Vault?
It’s a rule that the IRS implemented right away when they first allowed precious metals in a self-directed IRA account. It isn’t permitted for IRA account holders to store their metals at home. This physical asset must remain in a secure, IRS approved depository. And it must be held and managed by a qualified custodian.
The good thing is that investors have an opportunity to choose segregated or non-segregated storage when they pick a depository. Keeping a segregated storage vault means your precious metals are stored safely in a vault all your own.
Does the IRS Endorse Specific Storehouses and Depositories?
Right now, the IRS currently endorses 6 different storehouses and depositories for precious metals. The names of each of these storage facilities and other pertinent and specific information are as follows:
- Brinks Global Services – this organization is one of the top storage facilities throughout the world and they are a highly respected company. They have authorized depositories in London and New York City. They provide an online portal for inventory management. Plus, they are fully liable for all of the valuables including precious metals stored at their facilities.
- Delaware Depository Service Company – this organization has received IRS approval and their licenses from the CME Group as well the COMEX and NYMEX markets. They have $1 billion all risk insurance coverage, shipments are covered up to $100,000, and they provide their clients with big tax advantages.
- J.P. Morgan Global Metals – they received their depository approval in 2011. They have state-of-the-art vaults and facilities in Singapore, London, and New York. And clients can store rhodium, platinum, gold, silver, and palladium in a J.P. Morgan storage facility.
- CNT Depository – based out of Bridgewater, Massachusetts, this COMEX-approved depository has been in business for 35 years and their annual revenue is $8 billion per year. They are insured by Lloyds of London for 100% of the assets stored in their facility.
- ScotiaMocatta Depository – this well-respected organization has roots in the financial industry dating back to 1671. They are considered Canada’s Gold Bank and they officially got into the precious metals storage business in 1997. It is a COMEX approved facility with an excellent reputation in the investment world.
- HSBC Bank – investors may not realize it, but HSBC Bank has been storing precious metals for accountholders since 2003. And even more impressive is the fact that they are the largest bullion clearer throughout the entire world. And they’re the number one silver and gold dealer since 2003. You can’t go wrong storing precious metals with HSBC.
Investing in IRA approved precious metals is a great way to bolster your retirement and grow your future wealth. To get started, I highly recommend reading my review of the major players in the gold IRA investing space. Use this valuable information to choose the right gold IRA company to begin investing with today.