Home Storage Gold IRA- An Effective IRA Investment Strategy For Storing Your Valuable Property
Home storage IRA is a popular way for many people to save money for their future. A home storage IRA is designed to hold gold and other assets that are not used in everyday business transactions but that can be liquidated in a few years. Home storage rules are pretty much the same as for traditional IRAs, so is a home storage gold IRA really legal?
Is a Home Storage Gold IRA Legal?
The short answer is: yes. A home storage IRA is allowed to hold investments in all kinds of goods. While some may consider this illegal or simply improper, other people feel it’s perfectly acceptable. There are two main reasons for this. The first is that the rules for these types of IRAs are written by the IRS and are therefore not influenced by any political elements.
The second reason is that the IRS considers all purchases to be home storage transactions. It is up to the internal revenue service (IRS) to set the rules that will be enforced. As it turns out, the decision has nothing to do with the popularity of an IRA. As a matter of fact, they don’t like it when you buy things with your IRA. So, they have no choice but to enforce the rules.
There are a number of reasons why home storage gold IRAs are considered to be legal and appropriate. First, there is no central depository for these types of assets. This is not true for regular gold IRA’s which are always stored in a depository managed by a major financial institution. The profits earned on the sale of these assets go directly back to your account. The only way these precious metals can be accessed is through the IRA’s custodian.
When you store gold assets in a custodian, they are under strict orders not to touch them. If you do, then they face fines and penalties. Many IRA custodians will do whatever they can to prevent their clients from accessing their precious metals. In order to obtain access to physical precious metals for your home storage gold IRA, there are additional options available.
For example, you may want to open a “self-directed IRA LLC” which is a type of legal entity and thus, exempt from many of the conflicts that would occur with a regular “pass-through” account. Another option is to open a self-directed IRA LLC through a brokerage firm that does all of the paperwork and business forms for you. Many brokerage firms offer a variety of self-directed IRA LLC arrangements which could allow you to avoid some of the obvious risks associated with owning a traditional IRA.
There are also some IRA custodians that allow you to form an IRA LLC on your own, using nothing else but legal documents as proof of identification. This allows you to bypass many of the hassles involved in opening a traditional IRA and incorporating a Limited Liability Company (LLC). You would still be legally responsible for the transaction, though. However, with a self-directed IRA LLC, you may be able to avoid many of the costly fees associated with owning and operating a traditional IRA.
If you have been asked to deposit money into a Self Directed IRA for safekeeping from a government agency or other institution, be sure to read the terms and conditions. Many IRA custodians will not process these types of transactions unless you have explicit permission from the proper authorities. The IRS, for example, will not allow any un-escrowed funds to be deposited into a Self Directed IRA unless you can show proof of your identity as well as your ownership of the property being invested in.