Augusta consulted with several attorneys regarding the home delivery gold IRA structure. Below are some "Do’s and Don’ts" compiled from their research. However, remember that with control comes responsibility. Augusta does not provide legal or tax advice, so it is imperative that an investor looking to structure his or her IRA in this fashion do the proper research and employ the services of a tax or legal professional well-versed in single-member LLCs inside an IRA. Structured correctly, the IRA-owned LLC can be a viable investment structure for a self-directed IRA.
- Don't proceed with a home delivery gold IRA until you fully understand and are comfortable with the risks associated with this IRA structure.
- Do create a brand new LLC for the specific purpose of owning IRA assets.
- Don’t commingle non-IRA assets with the IRA assets held in the LLC.
- Do ensure that the LLC remains in compliance with all state laws related to the upkeep of the LLC. Promptly file any paperwork or fees required by the state in which your IRA's LLC is formed. If applicable, pay any required registered agent fees.
- Do ensure that both you and the LLC file all necessary tax forms related to the LLC and the IRA transactions.
- Do consult your tax professional regularly, so you remain in compliance with all tax requirements related to this structure.
- Do regularly communicate with the IRA custodian in order to remain in compliance with all requirements of the custodian.
- Don’t allow “disqualifed persons” to engage in any “prohibited transactions” in their dealings with the LLC. Do consult your attorney with any questions, so you remain in compliance with all legal requirements related to this structure.
Do not store IRA precious metals at home unless or until the IRS issues clear guidance on whether home storage complies with the tax code.Do store IRA precious metals in the physical possession of an IRS-approved IRA trustee or custodian. The attorneys Augusta consulted believe a bank safe deposit box in the name of the LLC fulfills this requirement.Do consult your chosen legal or tax professional prior to storing IRA precious metals in a bank safe deposit box in the name of the LLC so that you fully understand the risks associated with doing so.Do understand there are other storage options for your precious metals, including storage of metals at a highly-secure, non-government, threat-averse, insured private IRS-approved facility, managed by an IRS-approved custodian/trustee.Do understand it is recommended that you sign an affidavit stating the coins in the IRA are being held solely for the benefit of the IRA and not for any personal benefit or other benefit.Don't take or use your IRA's precious metals or sell your IRA's precious metals for cash without contacting your custodian first. Your custodian will walk you through the proper procedure. For example, with Kingdom Trust, if you wish to take a distribution of the precious metals ("In-Kind Distribution"), you must contact Kingdom Trust for an IRA LLC Distribution Request Form. You would fill out this form and send it back to them. They would then reduce the value of your IRA's LLC by the amount you are taking from it. If you wish to sell your precious metals for cash ("Cash Distribution from LLC After Liquidation"), you must send the cash generated from the sale to Kingdom Trust, for the benefit of the IRA, and it would be coded as a redemption of the LLC. You would then complete the IRA LLC Distribution Request Form and send it back to Kingdom Trust. In either case, you would receive IRS form 1099-R by January 31 of the following year.
- Examples of disqualified persons include (but are not limited to) the IRA holder and his/her spouse; the IRA holder’s lineal descendants and ascendants (children, grandchildren, parents, grandparents, etc.); investment advisors, managers and fiduciaries; any entity in which disqualified persons have a 50% or greater interest; anyone providing services to the IRA.
- Examples of prohibited transactions include (but are not limited to) borrowing money from the IRA LLC; selling property to it; getting paid to manage it; personally guaranteeing a loan to it or using its assets as security for a personal loan; buying property or precious metals for personal use with IRA funds or buying property or precious metals for the IRA from a disqualified person; paying personal expenses with IRA assets.
If you have any tax or legal questions regarding home delivery IRAs, LLCs, or the coins your IRA LLC can buy, we strongly recommend that you contact an attorney or tax professional of your choice.