A gold and silver IRA is a self-directed individual retirement account that holds physical precious metals in place of, or alongside, the stocks and bonds you’d find in an ordinary IRA. It follows the same tax rules as any other IRA, but the mechanics are different: you need an IRS-approved custodian to hold the account, a qualified dealer to supply the metal, and a third-party depository to store it. Break any of the rules on purity, storage, or who you transact with and the IRS can treat your entire balance as distributed, with tax and penalties to match.
Which Gold and Silver Products Qualify
Federal law ties IRA-eligible bullion to the fineness standards that regulated futures markets like COMEX use for physical delivery.1Office of the Law Revision Counsel. 26 USC 408 – Individual Retirement Accounts For gold, that means 0.995 fineness (99.5% pure).2CME Group. Chapter 113 Gold Futures For silver, it’s 0.999 (99.9% pure).3CME Group. Chapter 112 Silver Futures Bars and rounds have to meet those thresholds and usually carry a hallmark from a recognized refiner or national mint.
Some coins qualify by statutory exception even when they’d otherwise fail the purity test. American Gold Eagles are the most familiar example: they contain only 91.67% gold, but Congress listed them by name. American Silver Eagles, certain platinum coins described in federal coinage law, and coins issued under the laws of any state also qualify.1Office of the Law Revision Counsel. 26 USC 408 – Individual Retirement Accounts
Jewelry, numismatic collectibles, and anything that misses the fineness standard is off-limits. If your account buys a non-qualifying item anyway, the IRS treats the full purchase price as an immediate taxable distribution, and if you’re under 59½ the 10% early withdrawal penalty stacks on top.4Internal Revenue Service. Investments in Collectibles in Individually Directed Qualified Plan Accounts
Traditional or Roth
You can structure a precious metals IRA as either type. The metals inside are identical; the tax treatment is not.
A traditional IRA gives you a potential deduction on contributions and taxes withdrawals as ordinary income later. Required minimum distributions apply during your lifetime. A Roth IRA takes after-tax dollars going in but pays out tax-free, provided you’re at least 59½ and the account has been open for five years, and it has no lifetime RMDs. Which one saves you more money comes down to whether your tax rate will be higher now or in retirement.
2026 Contribution Limits
The 2026 cap across all your traditional and Roth IRAs combined is $7,500, or $8,600 if you’re 50 or older, and you can’t contribute more than your taxable compensation for the year.5Internal Revenue Service. Retirement Topics – IRA Contribution Limits The ceiling is a single pool across account types, not per account. Most people fund a precious metals IRA mainly by rolling over an existing retirement account, because rollover dollars don’t count against the annual limit.
Opening the Account: Custodian and Dealer
You can’t just open a brokerage account and start buying gold bars. A precious metals IRA needs two outside parties beyond you.
The custodian is a trust company, bank, or other entity approved under Treasury regulations to hold IRA assets and handle tax reporting. The IRS publishes a list of approved nonbank trustees and custodians authorized for this role.6Internal Revenue Service. Approved Nonbank Trustees and Custodians You apply through the custodian with your Social Security number, government-issued ID, and beneficiary designations. Setup fees generally run $50 to $300, plus annual maintenance charges that vary with account size.
The dealer supplies the metal and works with the custodian to confirm each product meets the fineness rules. The single biggest financial risk in this whole process lives here: the dealer’s spread, meaning the gap between what you pay and what the dealer would pay to buy the metal back. Legitimate spreads vary, but the Financial Industry Regulatory Authority has documented fraudulent dealers charging markups above 300%, with some victims losing a third to half of their retirement savings to excessive fees and commissions before any metal was delivered.7FINRA. Investor Bulletin: 10 Things to Ask Before Buying Physical Gold, Silver or Other Metals Compare the dealer’s sell price to the spot price and get the buyback price in writing before you commit.
Funding the Account
Money reaches your new self-directed IRA one of two ways, and the difference matters.
Direct Trustee-to-Trustee Transfer
In a direct transfer, funds move from your current IRA or retirement plan custodian straight to the new one. You never touch the money, there’s no tax event, and there’s no clock ticking. You start the process by submitting a transfer authorization to your existing plan administrator, and the money typically arrives in two to three weeks. There’s no cap on how many direct transfers you can do in a year.8Internal Revenue Service. Rollovers of Retirement Plan and IRA Distributions
60-Day Indirect Rollover
With an indirect rollover, the current custodian cuts you a check. You then have 60 days to deposit the full amount into the new account. Miss the deadline and the IRS treats the whole distribution as taxable, with a 10% penalty on top if you’re under 59½.
One trap catches people: you can complete only one indirect IRA-to-IRA rollover in any 12-month period, counting all your IRAs together as a single pool. Direct trustee-to-trustee transfers are exempt from that limit.8Internal Revenue Service. Rollovers of Retirement Plan and IRA Distributions For almost everyone, the direct transfer is the safer path.
Buying and Storing the Metal
Once cash is in the account, you direct the custodian to buy specific products from your chosen dealer. The custodian pays the dealer directly. You cannot pay for the metals personally or route the transaction through your own hands. The dealer then ships the physical metal to an approved depository.
You Cannot Store IRA Metals at Home
Federal law requires IRA-owned bullion to stay in the physical possession of a trustee or custodian.1Office of the Law Revision Counsel. 26 USC 408 – Individual Retirement Accounts A home safe, private vault, or bank safety deposit box in your own name doesn’t qualify. Take personal possession and the IRS treats the metals as distributed, with income tax and the 10% early withdrawal penalty if you’re under 59½.9Internal Revenue Service. Publication 590-B (2025), Distributions from Individual Retirement Arrangements (IRAs)
Some companies market “home storage IRAs” that route the metals through a self-directed LLC to your residence. The U.S. Tax Court rejected that structure in McNulty v. Commissioner, holding that the owner’s possession of coins bought with IRA funds was a taxable distribution no matter the LLC wrapper.
Segregated or Commingled Storage
Depositories typically offer two options. Segregated (allocated) storage keeps your bars and coins physically separate from other clients’ holdings, so you get back the exact serial-numbered items you deposited. Commingled (unallocated) storage pools your metal with everyone else’s; you own a claim to a quantity, not to specific pieces. Segregated storage costs more but gives you a cleaner chain of custody. Annual storage fees generally run $80 to $350, sometimes as a flat rate and sometimes as a percentage of account value.
Prohibited Transactions and Who Counts as a “Disqualified Person”
The IRS blocks certain dealings between your IRA and people close to it, so you can’t use retirement money for present-day personal benefit. A disqualified person includes you, your spouse, your parents, your children and their spouses, and any fiduciary of the account.10Internal Revenue Service. Prohibited Transactions These people generally can’t buy from, sell to, lend to, or otherwise transact with your IRA. You can’t sell your own gold coins to your IRA, and your IRA can’t lend money to your child.11Office of the Law Revision Counsel. 26 USC 4975 – Tax on Prohibited Transactions
The penalty for getting this wrong is severe. Instead of a discrete excise tax, the entire IRA loses its tax-exempt status as of the first day of the year the violation happened, and the IRS treats the full fair market value of everything in the account as distributed to you on that date.12Office of the Law Revision Counsel. 26 USC 408 – Individual Retirement Accounts Income tax on the whole balance follows, and the 10% early withdrawal penalty if you’re under 59½. One prohibited transaction can destroy the shelter over the entire account.
Taking Distributions
When you’re ready to pull money out, you can take distributions in kind, meaning the depository ships you the physical metal, or you can have the dealer buy the metal back and receive cash. Either way, the custodian reports the fair market value to the IRS on Form 1099-R.13Internal Revenue Service. 2025 Instructions for Forms 1099-R and 5498
Age 59½ and Early Withdrawals
Penalty-free distributions from a traditional precious metals IRA start at 59½; you still owe ordinary income tax, but not the extra 10%.14Internal Revenue Service. Retirement Topics – Exceptions to Tax on Early Distributions For a Roth, tax-free withdrawals of earnings require both age 59½ and the five-year holding period.
Take money out before 59½ and the 10% additional tax generally applies, on top of ordinary income tax. The IRS recognizes exceptions that waive the 10% (though not the income tax), including total and permanent disability, substantially equal periodic payments over life expectancy, unreimbursed medical expenses above 7.5% of adjusted gross income, a first-time home purchase up to $10,000, qualified higher education expenses, an IRS levy against the account, qualified birth or adoption expenses up to $5,000 per child, and federally declared disaster recovery up to $22,000.14Internal Revenue Service. Retirement Topics – Exceptions to Tax on Early Distributions
Required Minimum Distributions
Traditional IRA owners must start taking required minimum distributions once they hit a specific age. Under the SECURE 2.0 Act, the RMD starting age is 73 for people born between 1951 and 1959, and 75 for those born in 1960 or later, taking effect in 2033.15Internal Revenue Service. Retirement Plan and IRA Required Minimum Distributions FAQs Roth IRAs have no lifetime RMDs.
One wrinkle is specific to metals. RMDs are calculated from account value, so your custodian has to report the fair market value of the physical holdings as of December 31 each year on Form 5498. Because gold and silver prices move daily, that year-end number sets your withdrawal for the following year. Fall short of the full RMD by the deadline and the IRS charges a stiff excise tax on whatever you failed to take out.