Disclosure: Our content does not constitute financial advice. Speak to your financial advisor. We may earn money from companies reviewed. Learn more

sil

What Is A Silver IRA?

A silver IRA is a self-directed individual retirement account that invests in physical silver coins or bullion bars. Investing with a silver IRA affords investors the same tax advantages as a regular individual retirement account (IRA), only with the added benefit of being able to add physical silver assets to their account in addition to equities, securities, and paper funds.

With a silver IRA, individuals can save for their retirement with confidence knowing that their assets are secure and resistant to economic downswings. When you invest with a Regal IRA™ your assets are protected by trusted IRS-approved custodians, depositories, and dealers.

Investing in a silver IRA requires investors to have a valid IRA open with cash available in the account, or a 401(k), SEP, 403(b), or TSP that can be rolled over into a self-directed IRA. Regal Assets is proud to partner with the precious metal industry’s leading depositories and custodians to help investors diversify their portfolio and confidently save for their retirement with silver.

A new IRA setup is completed within 24 hours, and an IRA transfer takes less than 48 business hours. With Regal Assets, a 401(k) rollover process takes only 15-30 days and metals are guaranteed to arrive within 7 business days of delivery and are fully trackable and insured. At Regal Assets, we use a preferred depository at a secure Brink’s location in Salt Lake City, Utah.

Not all forms of silver investments qualify for a silver IRA. The Internal Revenue Service (IRS) sets criteria that all silver investments must meet to qualify for tax-advantaged status under IRC Section 408(m). These regulations only allow the inclusion of “silver...if a bank or approved non-bank trustee keeps physical possession of it.” Therefore, you cannot physically hold your silver investment yourself—instead, only IRS-approved trustees, such as Regal Assets and our custodial partners, can possess and secure your precious metals in a silver IRA.

Table of Contents

Silver Allowed in an IRA
Silver IRA Storage Options
IRS Requirements & Rules for Silver
Silver IRA Scams & Pitfalls To Avoid
IRA-approved Silver Coins
IRA-approved Silver Bars
Silver Bullion Coins NOT Allowed in an IRA
Pros and Cons of a Silver IRA

Silver Allowed in an IRA

Silver bullion, coins, and exchange-traded funds (ETFs) are allowed in an IRA in addition to other assets. For silver coins or bullion to be eligible for inclusion in an IRA, and therefore benefit from tax-deferment, they must be held by an IRS-approved trusted third party custodian.

In other words, you can’t hold and secure your own silver and still reap the benefits of an IRA. Instead, you must purchase and hold silver in an IRA via secure third-party custodians, distributors, and vendors such as Regal Assets and our partners.

If you possess physical silver coins or bullion bars on your own, your investment will be taxed as a collectible by the IRS and therefore be subject to a maximum capital gain tax rate of 28%. Securing silver via a Regal IRA™ will prevent your investment from being classified as a collectible and, in doing so, will shield it from capital gain taxes.

A silver IRA can also be referred to as a precious metals IRA, or a gold IRA if it contains gold as well. Precious Metals IRAS let you invest precious metals, including various types of silver bars and coins. However, not all types of silver can be held in a precious metals IRA, as the Internal Revenue Service (IRS) has laid out some very specific regulations that govern the types of silver bars and coins that are permitted to be held in an IRA. In fact, there are many popular silver bullion products that are not eligible for IRA investing solely because they're unable to meet the purity requirements set forth by the IRS.

In the following paragraphs, you'll learn about the types of silver coins and bars allowed in an IRA, IRS requirements for silver held in an IRA, and information about popular silver bullion coins that are NOT IRA-eligible:

Silver IRA Storage Options

The IRS only permits silver to be stored and vaulted in select facilities. To store silver in a self-directed IRA, your depository must have IRS approval. The IRS thoroughly vets each depositor to protect investors from potentially hazardous or insecure vaults.

Currently, the IRS approves of the following depositories for silver:

Brink’s Global Services
Delaware Depository Service Company
HSBC Bank USA
JP Morgan Chase Bank NA
ScotiaMocatta Depository
CNT Depository

Each of the above depository firms are located within the continental United States and store assets under their custody in highly secure, government-approved vaults. IRS-approved depositories are subject to strict government regulations and are frequently audited by authorities to ensure that their customer’s assets are well-guarded.

Investors should think of depositories as storage facilities for their precious metals and physical assets. Having your silver coins or bullion bars vaulted by a trusted depository minimizes risk for investors and ensures peace of mind knowing that your assets are protected and insured.

Offshore storage options also exist for investors looking to protect their precious metal investments from seizure or confiscation by government authorities. For instance, HSBC Bank offers European vault facilities in Zurich, London, Hong Kong, and Singapore. Other depositories, such as SWP Cayman, Bullionmax, ScotiaMocatta and Brink’s, also offer offshore vaults, which are IRS-approved for silver IRAs.

IRS Requirements & Rules for Silver

The IRS permits the holder of a self-directed precious metals IRA to hold of silver as an asset within their account while achieving the benefit of the tax benefits that are typically associated with such retirement accounts. This gives investors the opportunity to generate and accumulate retirement wealth on a tax-free or tax-deferred basis. The following are some of the requirements laid forth by the IRS regarding silver held in an IRA:

First and foremost, any silver held in an IRA must meet the IRS-mandated purity standards, which state that all silver bars and coins held in an IRA must meet a purity grade of 0.999 or higher. That means the silver must be at least 0.999% pure.
The IRA holder (the investor) must store the silver for their retirement account in an approved depository. Depositories are highly secure storage facilities for precious metals. Most bullion dealers that partner with IRA custodians will also have one or more preferred depositories.
A qualified custodian must be appointed as the trustee of the account. You'd typically choose from a leading dealer/broker that is partnered with one or more custodians to help you open and stock the account with the appropriate silver bullion.

Silver IRA Rollover Rules

401(k) plans (and other employer-sponsored accounts) allow employees to contribute a share of their wages to an individual retirement savings account, often with an employer match. Fortunately, silver investors can roll over the funds they have in a 401(k) into a silver IRA.

In other words, rolling over your 401(k) into a silver IRA entails the conversion of stocks and bonds, for example, into physical silver assets. Any precious metal IRA provider will guide you through the account application process to roll over your funds into a silver IRA—either by paper or electronic means—which is generally completed between 24 and 48 hours (business days only).

A silver IRA rollover requires investors to deposit the funds rolled over from their existing savings account into their silver IRA within 60 days. Exceeding this 60-day deposit rule will trigger a taxable withdrawal which is subject to a 10% early withdrawal penalty if the investor is 59.5 years of age or younger. Note that the IRS only permits one tax-free rollover per individual per year.

If you are rolling over funds from a 401(k) plan, be sure to check with your employer to confirm that they allow gold investments as part of their 401(k) program. Although you can work around restrictions imposed by employers, it helps to first establish whether this will be an obstacle or not.

Silver IRA Transfer Rules

Whereas moving funds from a 401(k) to a silver IRA is called a “rollover” (i.e., between two different types of accounts), transferring funds from an existing IRA to a silver IRA is called a “transfer” and is subject to different rules.

As we explained above, rollovers have a 60-day distribution period after which income taxes must be paid on the withdrawn funds in addition to an early withdrawal penalty. With IRA transfers, the funds are never in your possession and therefore the IRS cannot levy taxes or penalties.

In fact, IRA transfers can be performed completely under the radar of the IRS. Unlike a 401(k) rollover, an IRA transfer doesn’t have to be reported on Form 1040 on your income taxes. Therefore, the funds can be transferred from, say, your existing Roth IRA to a new silver IRA without Uncle Sam knowing the wiser.

Better yet, there are no limitations imposed on the number of IRA-to-IRA transfers you can complete in a given year. To protect your wealth from early withdrawal penalties or income taxes, it makes the most sense for investors to opt for direct IRA transfers when setting up a silver IRA.

Silver IRA Scams & Pitfalls To Avoid

Silver IRAs have the potential to help you diversify your nest egg, and earn revenue if the price of silver increases. However, like any money-making venture, there are risks involved with this type of investment. Scam artists and fraudsters on the market who prey on unsuspecting investors will try to convince you otherwise.

You should be skeptical of vendors and dealers who try to make you believe that silver IRAs are "recession-proof" or that they are guaranteed to make your a lot of money.

You should also be careful with brokers that incessantly attempt to upsell you on silver collectible coins, which trade at higher margins than bullion. The truth is that you may never recoup the premium you paid when you sell, so you shouldn’t trust a vendor who insists that expensive, marked-up numismatic coins are a better investment.

Further, you should invest in real silver bullion as opposed to proof coins whenever possible. Although proof coins and bullion both contain the same level of purity according to the US Mint, proof coins cost much more. Therefore, proof coins are collectible items whereas bullion is a more solid investment vehicle.

IRA-approved Silver Coins

Here's a list of the most popular silver bullion coins that are eligible to be deposited into an IRA:

In addition to coins listed above, many coins that meet minimum purity requirements and are manufactured by an official national government mint may also be IRA-eligible. If you already have a precious metals IRA and you're looking for silver coins to buy for it, it is imperative that you ensure you're buying the right products for your account. Avoid numismatics, commemoratives, and collector's coins, as most of these are grossly overpriced and ineligible for IRA investing.

IRA-approved Silver Bars

Any silver bars that meet the aforementioned minimum purity requirements, and are manufactured by a COMEX or NYMEX-approved assayer/refinery, can be deposited into a precious metals IRA. The following is a list of some of the more popular silver bars that may be held in an IRA:

Silver Bullion Coins NOT Allowed in an IRA

When investing in a silver IRA it is equally important to become familiar with the coins that you should be avoiding as it is to find the coins that are eligible. The following is a list of silver bullion coins that are not eligible to be deposited into a precious metals IRA

Pros and Cons of a Silver IRA

Silver IRAs can be great investment tool for building wealth and diversifying your retirement savings in the long-term. However, they’re not without their share of potential drawbacks. Below, we’ve listed both the benefits and disadvantages of investing in a silver IRA.

Pros of a Silver IRA

Silver IRAs allow investors to achieve portfolio diversification by gaining exposure to an asset untethered to the dollar, equity market performance and other mainstream assets
Improve the risk-adjusted returns of your portfolio while mitigating losses during stock market downturns
Potential hedge against currency devaluation and inflation
Capitalize on growing industrial and commercial demand for sterling silver and silver alloy
Safeguard your savings against economic collapse or paper market disaster
Enjoy the tax-deferment advantages of traditional and Roth IRAs
The responsibility for vaulting or securing your physical silver is entrusted to a third-party custodian

Cons of a Silver IRA

Silver, just like any other precious metal, doesn't pay any dividends or interest (unlike certain stocks, for example)
Price can fluctuate and is hard to predict
Past performance doesn't guarantee future returns
With a silver IRA, you cannot physically hold the silver assets on your own—instead, you must trust a third-party custodian and therefore assume some degree of counterparty risk
Investors may incur one-time or annual custodian and storage fees

By investing in physical silver, investors forego the cash flow benefits of accruing interest, dividends, and yields that paper-backed assets provide (however, dividend-paying assets come with their share of systemic risks)

Silver IRA