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Lane
Lane , JD, CFP, MBA, CRPS
Category: Finance
Satisfied Customers: 9214
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
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I currently have some gold and silver coins in a Self Directed

Resolved Question:

I currently have some gold and silver coins in a Self Directed IRA. They are charging me $160 per year in fees. I just found out today that I can legally hold the coins myself even though it's an IRA. How exactly do I do this? How do I make the rollover from this Self Directed IRA Service to me? (meaning local safety deposit box)
Submitted: 2 years ago.
Category: Finance
Expert:  Lane replied 2 years ago.

Lane :

Hi, if you have bullion, then Section 408(m)(3)(B) states that it must be held “in the physical possession of a trustee”. Usually, that ends up being a specialized third-party custodian. For coins, however, the Code has no such requirements. In fact, the Code does not place any restrictions whatsoever of the storage of gold coins. That means that your retirement account can purchase gold coins and you can hold onto them personally.

Lane :

I know of a company called Broad Financial (I have no affiliation) that will let you hold the and silver

Customer:

Ok, that's great. But how do I get the coins from the company now holding them. Do I have to do some kind of rollover like I did when I took the money out of my traditional IRA and bought the coins

Lane :

That's right, you do still need a trustee for the paperwork and tax reporting reporting...

Lane :

Each trustee has a different procedure, but you'll do a rollover to the new IRS "account"

Lane :

sorry for the typo (IRA) account

Customer:

wait a minute... i need to look at something...

Lane :

the the new trustee will direct the existing trtustee to send the physical pieces to you

Lane :

The trustee will typically charge a one-time IRA set-up fee (perhaps $25 to $50), an annual management fee for producing account statements and handling other paperwork

Lane :

Here's a good marketwatch story on the issue

Lane :

Even THAT story implies that the storage must be done by the custodian... but here's waht Broad Financial says about it

Lane :

"We have found that gold dealers are often misinformed in this area and erroneously inform their clients that gold coins may not be personally held. This could either be due to the fact that most people, including precious metals dealers, are not well versed in the Internal Revenue Code. Or it could just be that the dealers would rather hold your gold themselves so that they can charge holding fees. Whatever the case may be, the law is clear. Gold bullion must be held by an approved custodian, while gold coins may be held personally without restriction."

Customer:

let me ask this: there are two fees charged by my current trustee : precious metal IRA fee and a storage fee. if I asked them to send me the gold then I would save the storage fee, but they could continue to be my trustee, does that sound right

Lane :

That's right, as long as they will DO it ... there's no law that says they HAVE to, but as you can see from the Broad Financial Info, it IS possible if its not bullion

Lane :

There just has to be a trustee ... you have ti

Customer:

not bullion, coin. what does the law say? could they refuse to send me the coins?

Lane :

Yes, that's an issue of there not being any law that says they HAVE to .. their business model is their choice

Lane :

they cannot refuse a rollover request BUT and they cannot refuse to send you your gold

Lane :

sorry ... BUT, thy could code it a distribution, you'd have to pay taxes and a 10% penalty if you dont get it back in somewhere within 60 days

Customer:

OK, so I am paying a storage fee because no one said I had the choice to hold it myself, they simply provided a service and I didn't question it . does that sound right? What wording would you suggest I use to get my coins shipped to me

Lane :

Yep

Lane :

I would say the following:

Lane :

Regarding account number xxxxxxxx, I would like to request that you send me the coins, so that I can store them myself. I would like for you to continue to be the trustee of the IRA.. please advise the method you prefer for shipping, pickup, etc.

Lane :

Honestly, I'd start with a phone call

Lane :

But you can always do it by mail (and maybe send certified, so you'll have proof that they received it?)

Customer:

That sounds best. Then If they need it in writing I'll do that too. Ok, Lane thank you very much I feel better about the whole thing now just knowing I have choices.

Lane :

yes, and remember that if they say the won't do it that way... you go to the new trustee and they can then have it rolled over to the new ira "account," bu have them sent to you for physical storage

Lane :

Glad I could help

Lane :

If this HAS helped, I would appreciate a feedback rating of 3 (OK) or better … That's the only way they will pay us here.


HOWEVER, if you need more on this, PLEASE COME BACK here, so you won't be charged for another question.

Customer:

ok great advice. Thanks so much...

Lane :

YW :)

Lane and 2 other Finance Specialists are ready to help you
Expert:  Lane replied 2 years ago.

Thanks so much for the rating Adele!


If you'd like to work with ME again just say "For Lane only," at the beginning of your next question.

OR you can also add me as your preferred expert on your home page if you'd like.

Regardless, thanks again for the feedback!


Lane