Buying Physical Gold With IRA Funds
Yes — IRA money can buy physical gold, but only through a self-directed IRA whose custodian permits bullion, and only if the metal goes straight to an approved depository. A standard brokerage IRA will not do it, not because of a tax rule but because brokerages do not custody metal.
Which accounts can buy metal
| Account | Physical gold? | Note |
|---|---|---|
| Self-directed traditional IRA | Yes | The standard route for pre-tax rollover money |
| Self-directed Roth IRA | Yes | Tax-free growth; funding usually means a taxable conversion |
| SEP / SIMPLE IRA | Yes | Same mechanics, higher contribution limits |
| Brokerage IRA | No | ETFs and mining shares only — no custody of bullion |
| Current-employer 401(k) | No | Roll over first, usually only after 59½ or separation |
How the money actually moves
Four parties, one direction of travel:
- You choose products and agree a price, but never handle funds or metal.
- The custodian holds the IRA, approves the purchase and wires cash to the dealer.
- The dealer sources the bullion and ships it insured.
- The depository receives, verifies and stores the metal in the IRA's name.
Every compliant gold IRA looks like this. Any variation that routes money or metal through you personally is the problem, not a shortcut.
The possession rule, and why LLC schemes fail
Section 408(m)(3) requires the bullion to be in the physical possession of the IRA's trustee. Promoters have long marketed a workaround: the IRA funds a single-member LLC, the LLC buys coins, and the owner stores them at home as "manager" of the LLC.
The Tax Court closed it in McNulty v. Commissioner (157 T.C. No. 10, 2021). The coins were American Eagles — fully eligible products — and the taxpayer still received taxable distributions equal to the purchases, plus accuracy-related penalties. Home storage, safe deposit boxes and business premises all produce the same result.
What physical gold qualifies
- Gold: .995 fineness or better from an approved refiner or sovereign mint — plus the American Gold Eagle at .9167, eligible by statute
- Silver: .999 — American Silver Eagle, Canadian Maple Leaf, approved bars
- Platinum and palladium: .9995
Not eligible: Krugerrands, pre-1933 US gold, graded collectibles priced on grade, pre-1965 90% silver coinage, jewellery. Buying any of them inside the IRA is a deemed distribution of the purchase amount in that tax year.
Physical metal versus paper exposure
A brokerage IRA can hold a gold ETF today, with no custodian to appoint, no depository, no premium and no storage fee. That is a genuinely lower-friction way to own gold exposure, and for many investors it is the right answer.
Physical metal earns its extra cost only if you specifically want the properties paper does not have: an asset with no counterparty, no fund sponsor, no securities lending, and delivery available at distribution. If you cannot articulate why those matter to you, the ETF is cheaper and simpler — and honest comparison sites should say so.
What it costs to hold physical instead of paper
- Entry premium: 3%–8% over spot, paid once
- Custodian: $75–$200 a year
- Storage: $100–$300 a year
- Exit spread: 1%–3% under spot
Against a typical gold ETF expense ratio of 0.17%–0.40%, the physical route costs materially more in years one and two, and the gap narrows as the account grows because custodian and storage fees are usually flat.
Frequently asked questions
Can I use IRA money to buy gold and keep it at home?
No. That is the fact pattern the Tax Court taxed in McNulty. The metal must sit with the trustee until it is formally distributed to you.
Can I take my gold out later?
Yes — as an in-kind distribution. The custodian values it at fair market value on that date, reports it on Form 1099-R, and the depository ships it to you. From then on it is yours personally and taxed as a collectible when sold.
Is there a minimum purchase?
Nothing in the tax code. Dealers set their own minimums, from $10,000 to $50,000 across the major firms, and fixed annual fees make very small accounts inefficient.
Can I buy gold with a Roth IRA?
Yes, and it is the structurally better wrapper for an asset you expect to appreciate — qualified withdrawals are tax-free. The obstacle is funding: most metals IRAs are built from pre-tax rollovers, and moving those into a Roth is a taxable conversion.
Next step: if physical is what you want, the dealer's premium decides most of your return. Start with the 2026 comparison.