Gold IRA Rollover Guide

Gold IRA Rollover IconAn IRA rollover to precious metals allows you to add precious metals to your retirement account in a tax efficient manner.

If you are looking to add gold in your retirement account – then in all likelihood you will need to use a gold IRA rollover or transfer.

It’s crucial that you have a good grasp of how gold IRA rollovers work, either as part of a Do it Yourself approach, or to keep track of your IRA custodian’s progress (you’ll be privy to how they earn their fees!)

Gold IRA rollovers are pretty straightforward, and putting the knowledge and experience of an expert gold IRA specialist to work for you will make sure that it’s completely painless.

Now before you begin your IRA rollover, the question you should ask yourself is this:
Is gold in my IRA the right asset for me?

Gold has been a proven hedge against risk and storage of wealth for thousands of years, as well as a modern “insurance policy” against stock-market crashes and and other economic downturns – despite inflation. This is why gold is one of the wealthy’s top wealth-preservation tools, and why it forms the bedrock of the majority of central banks’ assets.

However, to be fair, for all of gold’s great advantages, there is one undeniable fact – it doesn’t pay dividends or interest.

Instead it acts as a balancing factor for riskier portfolio elements due to the fact that it will typically rise in value when paper assets take a downturn. As such, it helps take away the pain of financial crises. The Financial Crisis if 2007-2008 is an excellent example where the markets crashed and burned, and as a result gold saw massive gains.

As a case in point, a $33K gold self-directed IRA opened in 2001 would have been worth $175,155 by 2013, while its paper-backed traditional IRA counterpart would have struggled to reach $42,570 as the markets began their painfully slow recovery post-crash.

And “courtesy” of inflation, by 2013 you would have needed $43,432 to have the same spending power that the original $33K had in 2001 – meaning that the stock-market investment would have taken an overall loss in real terms. A loss, versus a 430% profit with gold.

You have to ask yourself if you want to reduce the aspect of your IRA that rises with the stock markets and pays dividends, and replace it with what amounts to an insurance policy.

If you don’t – then gold is not for you.

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What are Gold IRA Rollovers?

You rollover your ira to gold if your existing retirement plan doesn’t allow physical precious metals.

When the IRS relaxed rules on bullion in retirement funds, precious metals immediately became an essential part of many retirement accounts. However even today a number of accounts can’t or won’t accept physical gold, hence the need for a rollover.

In a nutshell, a gold IRA rollover involves these three simple steps…

 
Gold IRA Rollover Step 1Gold IRA Rollover Step #1: Choose a custodian / trustee to accept your rollover.

Your chosen custodian / trustee sets up an IRA on your behalf that is customized to allow tax-free investment in IRS approved precious metals. Popular specialists include Goldco (they are an A+ BBB member).

To get the ball rolling, you fill out a simple form to create an appropriate new self-directed IRA account (now known as a Gold IRA) – which will then be active in within 5 business days, sometimes sooner.

 
Gold IRA Rollover Step 2Gold IRA Rollover Step #2: Rolling Over Your Funds

You now take a distribution from your existing retirement plan. You can ask your plan administrator to make the payment directly into your newly set up gold IRA. Alternatively the administrator will issue your distribution in the form of a check made payable to your new account. Either way no taxes are withheld from your rollover.

 
Gold IRA Rollover Step 3Gold IRA Rollover Step #3: Buying Your Precious Metals

Now here’s where the fun begins! If you set up your account directly through Goldco, it’s time to choose the precious metals you want to buy for your gold IRA.

Specialist IRA gold dealers and IRA lawyers or accountants will help advise the best metals to buy in line with your retirement planning goals (some portfolios can be built with an eye on potential capital appreciation as well as wealth protection) and lock the prices at a rate you’re happy with. Once the selection process is complete, your trustee wires the funds to the dealer.

Secure delivery sees your metals delivered directly into your trustees vault at a chosen depository and that’s you – you’ve completed a gold IRA rollover!

The Gold IRA Rollovers Three Minute Expert Video

When and Why Would You Rollover Your Retirement Plan to Gold?

Normally*, a distribution (withdrawal of funds) from a retirement plan is a taxable occurrence. The amount of your withdrawal is considered income for that tax year and thusly it is taxed at your standard rate.

By rolling over your distribution from one plan to another or carrying out a direct trustee-to-trustee transfer, taxes generally do not apply until you finally withdraw the funds from your new plan.

Your individual retirement account in gold allows more of your hard-earned money to continue growing on a tax-deferred basis.

*(other than qualified Roth distributions and any amount already taxed – check with a registered IRA Advisor for up to date legislation)

Remember the One Rollover per Year Rule

As of January 1, 2015, you are only allowed to make one rollover from one IRA to another IRA in any 12-month period, no matter how many IRAs you own.

There are exemptions from this rule, where this one-per year limit does not apply:

  • Rollovers from Traditional IRAs to Roth IRAs (Conversions)
  • Trustee-to-Trustee Transfers to Another IRA
  • IRA-to-Plan Rollovers
  • Plan-to-IRA Rollovers
  • Plan-to-Plan Rollovers

You must include in your gross income any previously un-taxed amounts distributed from an IRA if you made an IRA-to-IRA rollover (other than above exceptions) in the preceding 12 months. You could also be subject to a 10% early withdrawal penalty on the amount you include in gross income if you are younger than 59½.

Complete details regarding the One Rollover Per Year rules are available on the IRS official website.

Which Traditional IRAs are Eligible for a Precious Metals Rollover?

Roth IRA Traditional IRA Simple IRA SEP IRA
Roth IRA YES 1 NO NO NO
Traditional IRA YES 2 YES 1 NO YES 1
Simple IRA YES 2
(after 2 yrs)
YES 1
(after 2 yrs)
YES 1 YES 1
(after 2 yrs)
SEP IRA YES 2 YES 1 NO YES 1
*1: Only one rollover in 12 months      *2: Must include in income

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