Precious Metal IRA At-Home Storage Risks

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With the global financial climate growing more ominous by the day, it’s no wonder that many Americans are becoming distrustful of conventional investments and flocking to precious metals. Increasingly, advertisers are touting Home Storage Gold IRAs as an option for investors to keep their physical gold at home while enjoying the tax benefits of an IRA.

In reality, though, turning to a Home Storage IRA, IRA LLC, or Checkbook IRA and attempting to store your gold at home can land you in a heap of financial trouble with the IRS - who never intended individuals to store their IRA funds at home. All that glitters is clearly not gold when it comes to Home Storage IRAs.

That doesn’t mean there aren’t ways to qualify for precious metal IRA home storage, however. We’ll outline how in this guide, along with the differences you can expect when pursuing the physical possession of precious metals (in an IRA or otherwise) and working with a qualified precious metals IRA custodian

Here’s what everyone should know about Home Storage IRAs before they take the plunge.

  1. What is a Home Storage Gold IRA?
  2. What Are the Qualifications for Home Storage Gold IRAs?
  3. What Are the Risks of Home Storage Gold IRAs?
  4. What Are the Differences Between Self-Directed IRAs Managed by a Qualified Custodian and Home Storage IRAs?
  5. How Can You Open a Precious Metals IRA?
  6. Home Storage Gold IRA FAQs
  7. Wrapping Up: Avoid Home Storage Risks and Open an SDIRA

What Is a Home Storage Gold IRA?

A Home Storage Gold IRA exists when individuals who meet specific requirements store the physical gold they’ve acquired for their IRA in their own home storage unit. Just like a regular IRA, gold Home Storage IRAs come with attractive benefits for those who are seeking to build up their retirement accounts. As an added bonus - and this is where the real attraction comes in for most people - you get to keep all of your gold with you at home.

Obviously, there are perks to the concept of storing your gold at home. But before even considering using this approach, you need to be fully aware of the Home Storage Gold IRA rules.

What Are the Qualifications for Home Storage Gold IRAs?

The biggest hurdle to keeping a Home Storage Gold IRA is regulatory compliance. While the concept of home storage seems simple, there’s a mountain of red tape that gets in the way – not to mention a whole slew of tax risks from the IRS.

For example, just to qualify for a Home Storage Gold IRA, the IRS wants you to have:gold-on-carpet2

  • A Limited Liability Corporation (LLC) with a unique type of Operating Agreement
  • Excruciatingly detailed yearly audits from a certified public accountant
  • An ongoing retainer agreement with an attorney
  • A public place of business
  • Proof that you have a “reputable financial background” to show you’re competent enough to manage the IRA
  • Net worth of $250,000 or greater
  • More than one owner of the trustee
  • Fidelity bond of $250,000 for each owner and employee of the LLC

All of those requirements must be met even before you begin buying any precious metals. Meaning, just to open an IRA of this type, you’ll be hit with large administrative costs, in addition to the time and paperwork you must get through.

And that’s just the tip of the iceberg. There are several other qualifications you must meet, and oftentimes the IRS pays special attention to Home Storage Gold IRAs for potential violations.

If you get audited, one little slip-up could result in all the funds in your Home Storage IRA being treated as a distribution, which means you’d lose all tax-deferred benefits and even get hit with an extra 10% penalty if you’re under 59 ½ years old. That’s up to 35% of your investment gone instantly.

But it could be even worse than that. If the IRS decides the day you opened your Home Storage IRA was the date of the initial “distribution”, you could be on the hook for additional interest and penalties on back taxes owed from the time of the distribution.

And don’t even think about simply putting gold acquired for your IRA into a safe. The IRS specifically prohibits that.

Clearly, the IRS could have made it easy to open a Home Storage Gold IRA. But it decisively didn’t, by ensuring all IRAs are run by qualified custodians. Even a Home Storage IRA is really just a roundabout way of investing in your LLC rather than the gold itself. It still must have a custodian on record.

What Are the Risks of Home Storage Gold IRAs?

If you’re prepared to meet the qualifications for a Home Storage Gold IRA, you should also be aware that there are several real risks associated with doing so. These accounts entail complex administrative duties to manage properly, and a lack of familiarity could result in poor returns for your retirement cushion. On top of that, no home is truly a castle, and security will always be a concern. Even with proper financial management and top-notch home security, you could be facing IRS penalties over an assortment of issues.

Complex Administrative Duties

When you decide to pursue a Home Storage Gold IRA, you’re forfeiting the chance to get any professional guidance on managing the metals in your account. Unlike Self-Directed IRAs properly administered through a qualified custodian, Home Storage Gold IRAs assume the account owner to be entirely self-sufficient in managing their funds.

That’s great if you have decades of financial experience and want to have total independence in how your funds are managed. But if you’re like most savers, navigating the administrative upkeep of your precious metals IRA on your own is a treacherous task.

Limited Security

Even if you manage to satisfy all the requirements and feel comfortable handling the administration of your Home Storage IRA, there’s another catching point to consider before diving into home storage: security.

In comparison to a depository with state-of-the-art security systems, how safe will your metals be in a home safe or at a local security deposit box?

Granted, the chances of a thief getting inside your home safe or security deposit box might be low, but the relative security of those storage locations pales in comparison to what you’d get from having your metals registered with an authorized custodian and stored professionally through an authorized depository.

Depositories that store metals on your behalf still give you access to your gold and silver, but you get the advantage of housing them in a world-class facility where they can never fall into the wrong hands.

Plus, the metals never touch the depository’s balance sheet, so they’re shielded from government entities and insulated from any trouble that might befall the depository itself.

Non-Compliance Penalties

Home Storage Gold IRAs are not a safe way to invest for retirement. They’ve occupied a legal gray area until one recent court case decreed that IRA owners invested in gold and silver coins can’t self-store them at home.

The judge of the Tax Court case in question– Andrew McNulty et al. v. Commissioner – ruled that Andrew and Donna McNulty must pay the IRS over $300,000 in taxes, fees, and penalties on an IRA balance of $730,000 for their failure to comply with Home Storage Gold IRA rules.

Even if you think you’re compliant, you may be looking at a 10% early withdrawal fee when you transfer the gold to your home (unless you're over 59.5), the loss of tax-deferred status on your Home Storage Gold IRA, and an increased chance of being audited - which may lead to innumerable unexpected fines.

Unless you want nearly half of your nest egg wiped out, we recommend avoiding Home Storage IRAs entirely, especially since there are safer ways to save physical precious metals in a retirement account.

What Are the Differences Between Self-Directed IRAs Managed by a Qualified Custodian and Home Storage IRAs?

For those interested in allocating a portion of their savings in precious metals without the numerous significant risks associated with a Home Storage Gold IRA, a Self-Directed IRA managed by an authorized custodian is the perfect solution. You’ll enjoy all the benefits of a secure, well-managed IRA while also tapping into the future-proof value of precious metals. Here are four of the key advantages of self-directed precious metals IRAs compared to home storage.


Self-Directed IRAs managed by an authorized custodian were acknowledged as an indisputably legal option by the IRS in 1996. Since then, millions of people have been able to fund their retirements by choosing the commodities or investments of their choosing, including non-traditional assets like precious metals. Just like conventional IRAs, Self-Directed IRAs follow IRS guidelines to the letter, meaning there’s no risk involved.

The legality of Home Storage IRAs, on the other hand, is still a bit murky, and there’s no guarantee the IRS won’t decide to cause problems for home storage account holders down the road.


Home Storage Gold IRAs force the account holder to take on full liability for the ownership and management of their account. That kind of “freedom” might sound appealing, but in reality, it can do more harm than good: legal fees, lack of professional guidance, increased tax liability, and the list goes on.

A Self-Directed IRA managed by a qualified custodian circumvents those problems by appointing a legal custodian to administer your account. You’re still in full control of the metals that you own, but the custodial structure keeps you from getting bogged down in all the red tape, excessive fees, and overt risks of home storage.

There are many precious metals IRA storage options that will keep your assets as secure as possible. In some cases, you can opt to have your gold stored separately in an individual vault for optimum security. Depositories take their responsibilities to their customers extremely seriously - but even in the unlikely situation that they’re breached, your deposits are insured.

Approved metals

Depending on how you interpret the tax code, the Home Storage Gold IRA structure can be rather restrictive in terms of the types of metals you’re allowed to invest in.

For example, unless you designate yourself as a trustee – which is yet another complex legal process that’s very easy to get wrong and another chance to jeopardize your tax-deferred benefits – Home Storage IRAs limit your approved options for metals to American Eagle coins only.

A Self-Directed IRA managed by a qualified custodian, on the other hand, opens you up to several types of goldsilverplatinum, and palladium. Each of these precious metals has its supporters, with gold advocates pointing to its enduring history as a stable commodity and inverse relationship with the value of the dollar, silver enthusiasts (like Warren Buffett) emphasize its many industrial applications, platinum fans appreciating its rarity, and palladium patrons acknowledging the demand for catalytic converters. With a Self-Directed IRA, the choice is yours.


One of the biggest advantages is that you can remain out of the vigilant eyes of Uncle Sam and the IRS.

In contrast to the meticulous documentation and overbearing qualifications dictated by the IRS for Home Storage Gold IRAs, an account holder of a Self-Directed IRA with a qualified custodian enjoys a relatively lenient experience:

  • Mistakes leading to unintended distributions and loss of tax-deferred status are nearly impossible to make
  • Fast and easy to open - no difficult prerequisites
  • No lawyers or accountants are required at any point
  • Avoiding the IRS “red flag” associated with IRA LLCs
  • Choose from an IRS-approved list of compliant bullion (bars, rounds, or coins)

How Can You Open a Precious Metals IRA?

At Birch Gold Group, we make it easy to set up a Precious Metals IRA to enjoy the same independence and control that make Home Storage Gold IRAs so attractive, but without any of the associated liability and regulatory risk. Following these easy steps will get everything underway.

  1. Being by establishing a Self-Directed IRA. We can provide assistance and information to help you with this process.
  2. Appoint Birch Gold Group as the qualified custodian to manage your account.
  3. Choose a depository to store your funds. You could choose the Delaware Depository, where they’re insured up to $1 billion by Lloyd’s of London. Or you might pick Los Angeles, New York City or Salt Lake City with Brink’s, the largest non-bank, non-government holder of precious metals in the world.
  4. From there, you can choose what metals you’d like to invest in. We’ll walk you through the pros and cons of each metal when you’re ready to make a purchase.
  5. You can visit the depository any time you like to see your precious metals in person.
  6. You can withdraw your metals whenever you’d like – even if you are not yet qualified to take distributions (although this would incur the normal penalties from the IRS for early withdrawal).

In all, it’s a fantastic solution for anyone who would like to safeguard their IRA or 401(k).

Home Storage Gold IRA FAQs


Are home gold IRAs legal?

While Home Storage Gold IRAs are part of a legal loophole, they can only be opened and operated under strict and complicated guidelines. Failing to meet those guidelines at any time can result in significant fees, penalties, and the potential for audits.

Can you store gold at home?

Absolutely! You can store gold outside of an IRA however you wish, from burying it in the backyard (we don’t recommend this) to storing it in a home safe. You can also take possession of physical gold by opening a Self-Directed IRA or a precious metals IRA, though your gold will be stored safely at an insured depository for you to visit (and potentially withdraw) at any time.

What should I be aware of regarding Home Storage Gold IRAs?

Beware of any business that promises the easy and safe setup of a Home Storage Gold IRA. Even if they help you with the establishment of an LLC, you’ll be the only one liable for the loss in your retirement savings due to mismanagement, fees, and the loss of tax deferment. The truth of the matter is that Home Storage IRAs of any kind are difficult to establish, hard to maintain, and prone to IRS audits - and you should proceed with every degree of caution to protect your savings.

Wrapping Up: Avoid Home Storage Risks and Open an SDIRA

If the thought of storing your gold at home appeals to you, there are ways to do it that don’t endanger your retirement like a Home Storage Gold IRA does. If you do meet the steep requirements to form a Home Storage Gold IRA, understand that there are many risks and potential penalties that come with it. As an alternative, choose to open a Self-Directed IRA and invest safely in the precious metals of your choice, or opt to store your gold in your home outside an IRA.

If you’re interested in learning how precious metals can protect your retirement savings, and without the excessive liability of a Home Storage IRA, contact us today.

Call us at (800) 355-2116, or click here to request a free info kit on gold.

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