On occasion investors call a precious metals IRA a gold IRA, because this retirement account allows you to buy precious metals like gold, silver, platinum, and palladium as an investment that you can hold in your retirement account. But in certain cases the gold coins and bars will not meet eligibility requirements set forth by the IRS, otherwise known as the Internal Revenue Service, because their requirements and purity standards are very specific regarding the gold purchases that they allow in these precious metals IRA accounts. Believe it or not, there are quite a few gold coins and bars that aren’t allowed to be purchased in a gold IRA because they failed to meet the mandated IRS purity requirements at a minimum.
Throughout the rest of this article, you’ll discover the best bullion types and options for gold IRA accounts, you’ll learn about the requirements set forth by the IRS regarding precious metals IRAs, and we’ll even share some of the most popular gold bars and coins that do not meet the eligibility set forth by the IRS.
Gold IRS Requirements
The IRS permits account holders of self-directed precious metals IRAs to purchase eligible gold products in their retirement account to receive big tax benefits. This gives investors portfolio protection against inflation and allows them to create tax-free or tax-deferred wealth on a consistent basis by investing in alternatives like gold, silver, platinum, and palladium.
The eligibility requirements to store gold and own it within an IRA are as follows.
- Any gold products that you purchase for your IRA account must reach certain purity levels. The minimum level of purity is 0.995 pure. Another way to put it is the gold bar or gold coin must have at least 0.995% of pure gold in order to be eligible for a precious metals IRA.
- Purchasing gold within an IRA means it has to be stored in a depository with IRS approval. These depositories are safe and secure storage facilities. Some depositories have approval by the IRS and some do not, so you have to make sure you’re using the right one. Your broker or bullion dealer will likely have a preferred depository that they use so you can stick with their favorite choice.
- All IRA accounts must have an appointed custodian. In this typical scenario the investor would connect with a dealer to purchase gold for their IRA account. The dealer will then help them set up the account using the custodian that they are already partnered with. By working directly with your broker or dealer, you’ll only have to deal with one company instead of a custodian, a dealer, and a depository because all of this will be handled already.
Gold Coins Approved by the IRS
Below is a list of gold coins that are popular and eligible to be purchased within a gold IRA account. They include:
- Gold American Eagle coins – this coin has a purity level of 91.67 pure, but the total weight is 1.0909 Troy ounces, so there is still a full Troy ounce of gold within it.
- Gold American Buffalo coins – these 1 ounce coins are the first to achieve .9999 purity in the United States when they were first released in 2006. The Gold Buffalo coins are looked upon as major competition to their counterpart the Canadian Maple Leaf.
- Gold Australian Kangaroo coins – originally introduced in 1987, they were minted by the Western Australian Government through their subsidiary holding Gold Corporation. These coins have a face value and are considered legal tender. They are also very popular amongst collectors and investors for the past 25 years.
- Gold Austrian Philharmonic coins – this coin is very popular because it contains a symphony of instruments including the French horn, cello, violin, bassoon, and harp.
- Gold Canadian Maple Leaf coins – the Royal Canadian Mint guarantees the weight and purity of these Canadian coins. They are usually sold in mint tubes in packs of 10.
- Gold Canadian War of 1812 coins – the Royal Canadian Mint also guarantees the purity and weight of this limited edition commemorative coin as well. It is issued on the bicentennial of the War of 1812. They mint them in sheets of 20 or they sell them in singles from the Royal Canadian Mint.
Gold Bars with Full IRA Approval
- Gold Credit Suisse bars – these offerings are minted in Zürich, Switzerland in the Credit Suisse headquarters. Each of these bars meets the purity requirement of 99.99%.
- Gold Johnson Matthey bars – these bars aren’t as for sale as other popular bars made of gold bullion. But they are available in a wide range of denominations and are well respected throughout the industry as some of the finest bars made of gold that you can purchase. These bars have a guaranteed fineness level of .9999 gold.
- Gold Valcambi Combi Bars – these bars are divisible and made up of a purity level of 0.999% gold. The big advantage of this combination bar is you can detach the pieces and create fifty 1g mini gold bars out of it.
Gold Coins That Aren’t Permitted in a Precious Metals IRA
Even though there are gold coins in the thousands that aren’t usable for IRA investing, the list that you are about to see is the most popular coins that aren’t eligible for a gold or precious metals IRA. If a bullion dealer tries to sell you these for your self-directed retirement account, correct their error and stay away from them. The following coins are not allowed in a precious metals IRA:
- 100 Peso Chilean Coins
- 20 Lira Italian Gold Coin
- 20 Franc French Gold Coins
- Tower of David Israel Gold Coins
- Gold Uruguay Five Pesos
- Gold New Zealand Kiwi Coins
- 10 Netherlands Gold Guilders
- Numerous Isle Of Man Gold Coins
- 1/10 Ounce Royal Cherub Gibraltar Gold Coin
- Sertum Jigme DorjiWangchuck Bhutan Gold Coins
- Gold 100 Coronas Austria Coins
- 100,000 Souls Miguel Grau Peru Gold Coins
- Gold Peru One Libra Coin
- 60 Venezuela Gold Bolivars
- Vrerneli Switzerland Coins
- 20 Lire Carlo Felice Sardinia Gold Coins
- 20 Francs Charles III Monaco Gold Coins
- 100 Francs Albert I Monaco Gold Coins
- Zlotych Boleslaw Poland Gold Coins
- United States Liberty Coins
- 20 Franc Swiss Coins
- Krugerrands Coins from South Africa
- Sovereign Gold Coins from the United Kingdom
- Queen’s Beasts Gold Coins from the United Kingdom
- 10 Kroner the Nightingale Denmark Gold Coins
- 10 Kroner Snow Queen Denmark Gold Coins
- 100 Korona Hungary Gold Coins
- Britannia United Kingdom Gold Coin
- Napoleon French Gold Coins
- 10 Guilder Dutch Gold Coins
- Chinese Panda Gold Coins
- Mexican Peso Gold Coins
- Yugoslavia Gold Dukat Alexander I
- Serbia Gold 10 Dinara
- Russia Gold 15 Roubles Nicholas II
- Russia Gold 10 RoublesChervonets
- Italy Gold 20 Lire Vittorio Emanuele II (1861-1878)
- Ukraine 1/4 oz Gold Archangel Michael (2014)
- Venice Gold Zecchino Ducat Pietro Grimani
- Venice Gold Zecchino Ducat Ludovico Manin
- Portugal Gold 10,000 Reis King Luiz I
- Portugal Gold 5000 Reis King Luiz I
- Romania Gold 20 Lei 3 Kings (1944)
- Vatican City Gold 100 Lire Pope Pius XI
- M PJ Spain Gold Escudo
- 100 Kurush Turkey Gold Coins
- Gold Sierra Leone Lion Head Coins
- Gold 1 Guinea Saudi Arabia Coins
Besides all of the coins mentioned above, it’s important to know the rules and regulations regarding a precious metals IRA. You do not want to own or purchase anything with a collector’s value, or a commemorative gold coin, or anything in the numismatic world of gold coins because they aren’t allowed within a precious metals IRA. They do not meet the levels of purity required by the Internal Revenue Service in order to qualify.
So do yourself a huge favor and avoid sales reps at gold companies that try to persuade you to buy certain types of coins that do not have precious metals IRA approval. These coins will typically come under the moniker of limited-edition, special, or rare. And these coins always have a hefty price tag because they tack on a huge premium well above the actual market value. So buying these coins is a losing proposition no matter what way you look at it, but it’s especially the wrong move if you’re trying to purchase them for a gold IRA account so avoid them at all costs.
The Major Benefits of Investing in a Precious Metals Gold IRA Account
Purchasing gold through a precious metals IRA has many advantages for investors trying to grow their retirement account. Some of the biggest advantages of opening a precious metals gold IRA account include the following:
- Owning gold helps you minimize your exposure to the US dollar. And as we all know, with the government constantly printing more and more money to help stem the collapse of the economy due to the coronavirus, the US dollar is becoming less and less valuable. By owning gold, you are backing away from your exposure to the US dollar and owning a much more stable and beneficial way to protect your wealth for many years to come. Gold has been considered legal tender for thousands of years and it will remain this way for thousands more. The US dollar could eventually collapse if the financial woes in the United States of America continue, so distance yourself from this currency as much as possible.
- Owning gold is a way to hedge your bets against inflation – many people look at gold as a way to hedge your bets against inflation. The US dollar has a variable price, but the owner of gold isn’t going to be subjected to the variable price of the US dollar. Inflation erodes the value of the US dollar over time, and the value of gold typically rises in tandem as the US dollar value falls. So it’s good to own gold as part of your retirement account when the value of the US dollar is crumbling. And if you haven’t been paying attention, the economic turmoil in the United States and around the world is causing the US dollar to lose value every day. And it’s going to erode even worse when the US prints its second round of stimulus checks for the American people and even more stimulus for American businesses.
Overall, owning gold in a precious metals IRA account has big benefits as you have just learned. Do yourself a favor and take time to learn about opening a precious metals IRA so you can distance yourself from the US dollar, the US economy, and everything devastating the current financial climate because of the coronavirus.