Question regarding Gold and Silver eagles as a vehicle for an IRA

CaptainRon

Was thinking of opening a new IRA for tax purposes, and considering the little lady loves gold bullion, I thought this may be a good time to pick up a set.

So basically I'm asking for as much info as possible, along with opinions on why or why not it is a good idea.

a. Basically if she is going to buy them anyway, is it a good idea, to get a break on your taxes for it.
b. Could this come back to bite us later on. (Even with no plans on selling)
c. How much of a hassel would be required in years to follow to maintain this IRA
d. Would we be able to hold the gold, or would it have to reside with a custodian.

This would be just for tax break purposes not as an investment hedge.

Thank you much...
Ron and Trish

1977topps

I don't know, but I have a pooch icon, too.

kranky

I think the biggest problem is finding a custodian who won't kill you with fees. A custodian, not you, must keep the coins. They'll probably want an annual fee that covers storage costs since they have to deal with physical custody. And what would they charge to handle a transaction?

And you can't put coins you already own in an IRA.

And you're kind of wasting the tax benefits of an IRA since bullion doesn't generate any income anyway. If you could sell your bullion at a profit later tax-free, you'd only be converting that tax-free profit into a taxable profit if you did it in an IRA.

CaptainRon

Thank you much Kranky...

ajc

You do get a tax break the year you contribute to a traditional IRA and any gains on it are tax free until you start making distributions. If you go with a Roth you pay after tax dollars then all the gains are tax free even when you make the distributions. If you are only dealing with bulllion, I would say just buy an exchange traded fund like GLD convertable to real gold. Then you don't have the problems of storing it as previously stated.