Home Articles The Tax Payer Relief Act of 1997 & Gold IRA Rules

The Tax Payer Relief Act of 1997 & Gold IRA Rules

    The Tax Payer Relief Act of 1997

    The Tax Payer Relief Act of 1997 made it possible to diversify your retirement savings by adding gold to your IRA account. It removed the barriers in the U.S. tax law that prevented such investments — giving investors an alternative to traditional IRAs. This law, in addition to other parts of the U.S. tax code, outline the gold IRA rules for backing your retirement savings with gold and other precious metals (like silver, Palladium and Platinum).

    But Not Any IRA Can Hold Precious Metals

    To invest your IRA in precious metals you’ll need a self-directed IRA. Self-directed IRAs allow you to combine traditional investments with precious metals. The custodian you chose for your IRA will determine your options when it comes time to choose your investments. Some banks offer self-directed IRAs — but only a short list of investment options that may include stocks, annuities and bonds but leave out non-traditional investments like precious metals. If you want to back your retirement savings account with gold or other precious metals you’ll need to find a custodian that let you invest in anything allowed by the 408 of the U.S. tax code (the gold IRA rules).

    Choosing The Right Gold IRA Custodian

    The tax code states that an investor must work through a third-party custodian. There are a number of custodians out there, and it is important to find one that you can trust. Research online, call them to get your own opinion, request more information and make sure you read our Gold IRA company reviews (can be found in the main menu on this website).

    Tax Advantages of Self-Directed IRAs

    Gold IRAs have the same tax advantages as a traditional Individual Retirement Account. These advantages allow you to transfer or rollover holdings from a 401K or IRA into a metals IRA without paying taxes on your investments.

    Warning: Fraudulent Investments

    The rules around gold IRAs are designed to protect you and the possibility and risk of fraud is one of the biggest issues with this type of investment. With that said we believe the key to avoiding fraud is proper research — and be sure that you know what it is you are investing in.