A gold IRA works like any other IRA, with one difference: instead of holding stocks or funds, the account owns physical gold or other approved precious metals, stored for you by a depository. Four parties are involved, money moves in through contributions, transfers or rollovers, and the IRS rules on taxes and withdrawals are the same ones you already know.
What a Gold IRA Is
"Gold IRA" is a marketing name, not a legal one. Legally, it's a self-directed IRA: an IRA whose custodian lets you hold assets beyond the usual menu of stocks, bonds and funds. Most brokerages, such as the large online firms, don't allow physical metal in their IRAs, which is why gold IRAs are opened with specialist custodians.
The tax code generally treats an IRA's purchase of collectibles, including most coins and metals, as a taxable distribution. Section 408(m) of the Internal Revenue Code carves out exceptions for certain U.S. coins and for bullion that meets minimum fineness, as long as a trustee holds it. That carve-out is the legal basis for every gold IRA. Our gold IRA rules guide covers it in detail.
In one sentence: a gold IRA is a regular IRA, run by a specialist custodian, that buys IRS-eligible bullion from a dealer and keeps it in an approved vault.
The Four Parties in Every Gold IRA
| Party | What they do | How they're paid |
|---|---|---|
| You | Own the IRA, choose the metals, approve each purchase and sale. | n/a |
| Custodian (trustee) | Holds the account, keeps records, reports to the IRS, sends money to the dealer and receives sale proceeds. Must be a bank or an IRS-approved non-bank trustee. | Setup and annual administration fees. |
| Dealer | Sells you the metal and usually offers to buy it back later. Often the company you first speak to, which then recommends a custodian. | The markup (spread) between the price you pay and the metal's spot value. |
| Depository | Stores and insures the metal in a vault, either in a shared (commingled) pool or segregated under your account. | Annual storage and insurance fees, often billed through the custodian. |
The company that advertises a "gold IRA" is almost always the dealer. It doesn't hold your account; the custodian does. That separation matters: ask which custodian and depository the dealer works with, and whether you can choose your own. See custodians and depositories.
How Money Gets Into a Gold IRA
There are three ways to fund the account, and the choice affects taxes and deadlines.
- New contributions. You can contribute up to $7,500 in 2026, plus a $1,100 catch-up at age 50 or older. That limit covers all your IRAs together, so most people use contributions to top up rather than to fund a gold IRA from scratch.
- Transfer from another IRA. A trustee-to-trustee transfer moves money directly from your current IRA custodian to the new one. It isn't a taxable event and isn't limited in number.
- Rollover from an employer plan. Money from a 401(k), 403(b), governmental 457(b) or the federal Thrift Savings Plan can usually be moved once you leave the employer, and sometimes while you still work there. A direct rollover avoids withholding and deadlines.
Most gold IRAs are funded by moving existing retirement savings. See the gold IRA rollover guide for the rules on each account type.
Step by Step: Opening a Gold IRA
- Decide how much, if any, of your savings should go into metals. Do this before you speak to a salesperson. Our pros and cons guide helps.
- Shortlist companies and get their terms in writing. Minimums, every fee, the custodian, the depository, the markup on the products they recommend, and the buyback policy. Use our 15-question checklist.
- Open the self-directed IRA with the custodian. The dealer usually helps with the application. You'll name beneficiaries and choose traditional or Roth.
- Request the transfer or direct rollover. The new custodian typically sends a transfer request to your old provider. Keep copies and watch for the funds to arrive.
- Choose your metals and lock a price. Prices are usually locked by phone at the moment you approve the order. Ask for the product names, quantities, price per unit and spot price at that moment in writing.
- The custodian pays the dealer, and the dealer ships to the depository. The metal goes straight to the vault, never to you.
- Confirm the holdings. Check that your custodian statement lists the exact products and quantities, and that the depository confirms receipt.
Gold IRA vs. Other Ways to Own Gold
A gold IRA isn't the only way to get gold exposure for retirement, and it's rarely the cheapest. Here's how the main options compare.
| Option | What you own | Tax treatment | Typical cost profile |
|---|---|---|---|
| Gold IRA | Physical bullion held in a vault for your IRA | Same as your IRA type (deferred or tax-free) | Setup, annual custodian and storage fees, plus dealer markup |
| Physical gold bought with taxable money | Coins or bars you hold or store yourself | Long-term gains taxed at collectibles rates, up to 28% federally | Dealer markup; your own storage and insurance |
| Gold fund or ETF in a regular IRA | Fund shares backed by gold or tracking its price | Same as your IRA type | Fund expense ratio; no separate custodian or storage fees |
| Gold mining stocks or funds | Shares of mining companies | Depends on the account | Brokerage costs; returns depend on the companies, not just gold |
People often choose a gold IRA because they specifically want physical metal held outside the financial system, not a fund. If that isn't important to you, a gold fund inside an existing IRA may give similar price exposure at lower cost. That's a legitimate alternative, and it's one reason we suggest settling your goals first.
Types of Gold IRA
Traditional gold IRA
Contributions may be deductible depending on your income and workplace plan, growth is tax-deferred, and withdrawals are taxed as ordinary income. Required minimum distributions start at 73 (75 if you were born in 1960 or later).
Roth gold IRA
Contributions aren't deductible, but qualified withdrawals are tax-free and the original owner has no required minimum distributions. Read the Roth gold IRA guide.
SEP gold IRA
A Simplified Employee Pension IRA for self-employed people and small businesses can also be self-directed and hold eligible metals, with the higher SEP contribution limits.
What Happens While You Own It
Day to day, very little. The custodian sends statements showing your holdings and their estimated value, and charges annual fees, which are paid from cash in the account or billed to you. Because the metal pays no interest, you may need a small cash balance in the IRA to cover fees. If you want to rebalance, you ask the dealer for a buyback quote or buy more metal, and the custodian settles the trade.
When you retire, you can sell metal for cash or take it out in kind. Either counts as a distribution. The withdrawals and RMDs guide covers the taxes and timing.
Sources
- 26 U.S. Code ยง408(m), investment in collectibles treated as distributions
- IRS Publication 590-A, Contributions to Individual Retirement Arrangements
- IRS: 401(k) limit increases to $24,500 for 2026, IRA limit increases to $7,500
- IRS: Rollovers of retirement plan and IRA distributions
- IRS: Approved non-bank trustees and custodians