Schedule a free call with a New Account Specialist: https://www.iraclub.com/podcast-link/ In this episode, IRA Club Founder and President Dennis Blitz shares some insight into the proper ways to store your IRA's gold that is in compliance with IRA regulations and keeps you from being flagged for additional taxes! DISCLAIMER: IRA Club does not provide investment, tax, financial, or legal advice, nor do we endorse any products, investments, or companies that provide such advice and investments. All parties are strongly encouraged to perform due diligence and consult with the appropriate professional(s) licensed in that area before entering any investment.
[00:00:00] The information contained herein is intended to help the viewer successfully navigate common IRS and Department of Labor requirements to help achieve successful results from their IRA. The information is not intended to replace information from your legal counsel or income tax professional. IRA Club does not offer or sell any investment. All investments have risk. This is the Investor's Row Podcast, powered by the IRA Club. Alternative investing reimagined.
[00:00:24] Whether you're a seasoned investor or just getting started, we're here to empower you to take control of your financial future and unlock the power of your self-directed retirement accounts. Let's get started. Hello, my name is Dennis Blitz. I'm with the IRA Club. And we're going to talk about investing in gold the right way, the proper way. This is not, I'm not trying to sell anybody gold.
[00:00:48] What we're going to talk about is how to avoid one of the most common pitfalls in gold investing. And actually, we're going to talk about two of them. But what happens so often with gold investing is the IRA company does not do a good job of explaining the rules to the customer, and the customer inadvertently makes a mistake. Sometimes they do explain it properly, and the customer just says, oh, no, that doesn't apply to me.
[00:01:17] And it does. So we're going to go over what the rules are so that you will never have an error with your gold investment. Gold is a very, very popular investment right now. It's gone up and badly crazy. It may go up more. I don't know. So we're going to talk about investing in gold or other precious metals. The same rules apply for silver, apply for copper.
[00:01:43] And if you want to know what metals you can use, put in your IRA or buy with your IRA, the IRS puts out a list of allowable metals. If you want to call our office, we can get that list for you and just send it out. You'll know a lot more about protecting yourself from mistakenly crossing a line that costs you a lot of money if you listen to what we have to say. All right. So let's start.
[00:02:12] Remember, the key thing here is you and your IRA are separate. You're two completely different entities. Now, I know that. You know that because you and I have a Social Security number. Your IRA doesn't have a Social Security number. You and I pay income tax. But your IRA doesn't pay income tax. And on and on. They are completely separate entities.
[00:02:39] So if your IRA buys gold, it's separate. You didn't buy the gold. The IRA bought the gold. And it's going to have to follow IRA rules. And the IRA rule is very, very simple. That it's got to be segregated from you. Separate from you. So, for example, we get this call all the time. Somebody bought gold in their IRA. They're with another company. And they bought gold in their IRA.
[00:03:08] And then they took that gold and they put it in a safe deposit box at their local bank. It's locked up in the safe deposit box. The box is at the bank. It sounds pretty good. Except who owns the safe deposit box? The client, not the IRA. Who has the key to the safe deposit box? The client, not the IRA.
[00:03:36] The internal revenue service will call that a distribution. And you'll pay income. The client will pay income tax on that gold, silver, copper, whatever it might be, sitting in that box. Okay. Now, we get the same exact story, a little different, when people put the gold or silver in a safe in their home.
[00:04:04] I have a safe in my home and only I know the combination. And they think it's segregated. No. You know the combination. You can open that up anytime you want. Spend it any way you want. Do whatever you want with it. The IRS is going to say that's a distribution. So, always keep your gold segregated according to IRA rules. Now, many IRA dealers don't do a good job of telling you that.
[00:04:34] We do want to do a good job. So, if your IRA that's at IRA Club buys the gold, you'll just let us know. And then we will take care of storing it for you. We don't touch it. We take care of storing it for you. And we put it in a storage facility that is government approved. We file it in the name of your IRA, not in your name. We do all the things that the IRS requires. And your IRA will never be taxed.
[00:05:04] Keep in mind that your IRA and you are separate. And the way to keep it separate is to let somebody select the IRA, the custodian for that IRA, the keeper of that IRA that is IRS approved. Now, the IRA Club happens to use the same depository that the FBI uses when they confiscate goods. You know, the FBI confiscates a lot of goods.
[00:05:32] And we use that same depository. There are other depositories that are recognized that we can use. Now, keep in mind if, again, if you are buying the gold from a dealer and the dealer says, and we won't take care of it for you, make sure that the dealer is holding it in the name of your IRA and not in your name. It's critically important because it's a distribution. Now, I'll tell you where the critically important gets more critically important,
[00:06:01] and that is so often the error isn't discovered right away. It's two years, two years, four years later before the error is discovered. And you know what? Not only do you have a tax due, but there's interest on that tax that you've been paying, that you will have to pay. So if you're going to make a mistake, find out about it the next day, which never happens.
[00:06:27] Use us, we'll make sure that it's in a government acceptable, facilitated, and segregated from you in a proper fashion. So very important on buying gold or silver or any precious metal. Now, let me give you one last comment about buying gold, the process of buying the gold or silver or whatever the metal is in your IRA.
[00:06:52] Many people call a gold dealer and buy the gold or the precious metal, and they're done, and they're happy. And even if they put it in their IRA property and so on and so forth. Let me tell you, back off for a moment before you do that, because gold dealers and precious metal dealers have no requirement on the markup.
[00:07:17] Now, obviously, we all understand they buy the metal at one price, mark it up, and sell it to you. We know that. How much is that markup? That markup can be pretty steep. I can tell you that right now, if you called five gold dealers and said, what's the price of gold? You're going to hear five different prices. From, you know, a thin markup to a really thick markup.
[00:07:46] So, always shop the dealers. Now, I don't want to sound, you know, like a curmudgeon, but if you do call a dealer that advertises on television, know in advance that's going to be a steep markup that you're going to have to pay, because those TV ads cost money, especially the TV ads that have a recognizable face that's giving the information. So, always shop when you're buying gold.
[00:08:15] You're going to get a lot of different prices, and shopping is your best friend. The next step is you're going to get a lot of gold companies who offer you free goods if you buy from them today. Those free goods that they're offering are virtually worthless. If they do have a value, they've stuck that into the price of the gold. Free goods, let's let them keep them. They're free goods. Find the best price for your gold.
[00:08:44] So, shopping is your friend. Take your time. It's okay. Well, thank you very, very much for joining us. If you have any questions, or if you would like to start your own self-directed IRA, or move your self-directed IRA to our company, please call us here at the office. Check out our website, iraclub.com, or if you call our office, it's 312-795-0988, and we're very happy to take the time and give you the rules of the IRA
[00:09:14] so that you won't cross a line that will trigger a taxable event. Okay? Thank you very much.