I read in the comments section the remarks from a member that he has found a Self Directed IRA custodian and a bank which allows him to hold physical silver that belongs to his SDIRA LLC at home, in a separate safe dedicated to his SDIRA holdings. This scheme fell within the legal definition of safe depository in the IRS rules.
Please help me with this. I would love to do this. Who is a good company who will help me set up the LLC and which custodial agent will allow this way of investing IRA moneys in PMs held at home.
Machobird. I checked with my SDIRA custodian bank and they are still doing this service. But, and here is the kicker, they will not work with people who plan to hold their eligible PMs at their home. I read the IRS ruling on this and it appears they allow this if the holder has a segregated safe storage similar to that offered at a bank or bullion storage facility. The custodian’s change of heart probably reflects an exceptionally cautious course so they don’t damage their business model due to a handful of people violating the IRS ‘loophole’ That’s the best I have at the moment in time.
The company I was planning to use to set up the SDIRA won’t take new customers who want to hold the PM’s at home, no matter what the conditions are at home. Here is their response:
“Gold/gold bullion must meet purity requirements (see point #2 in the attachment); must not be deemed as a collectible; and must be held by a bank custodian or IRS compliant trustee. Many companies that offer gold bullion have excellent security for protecting the gold bullion. Yet security is not the issue. In order for gold bullion to avoid crossing the line and being viewed as a collectible it has to be held by the IRS’ definition of a bank or trustee. See below:
The IRC requires that gold bullion be in the physical possession of either a “bank” or non-bank trustee that has been certified by the U.S. Treasury. IRC § 408(m)(3)(flush language); Here is a current list of non bank trustees approved to hold Gold for IRAs http://www.irs.gov/pub/irs-tege/nonbank_trustee_list.pdf.
There are at least two IRS Private Letter Rulings that address the sufficiency of gold bullion storage arrangements. The first is IRS PLR 200732027; the second is IRS PLR 200732026. In both of those PLRs, the IRS approved the storage situations because the custodians of the bullion were banking associations organized under the laws of the foreign country where they were located (PLR 200732026) or under the laws of a state in the U.S. (PLR 200732027).”
@machobird – I would definitely reach out to @bullrun to get his thoughts (or maybe he’ll reply to your post here). He has researched SDIRA inside and out and might possibly have some bank solutions for you.
@machobird and @buddy_boy8403 We have reached out to consult firms to address the issue and they are advising us to get a private letter ruling which would take 6-8 months and $8-$10,000. We are confident in how we interpret the letter of the law individually, but unfortunately that does not protect us and SD Bullion from lawsuits when someone disagrees. SDIRA from SilverDoctors.com is on temporary hold until we get a firm ruling or legal assistance backing the operation.
I guess you could say I determined the legality of holding personally after reading some of the subtexts of the IRS rules. In any case I hold my PMs in a separate safe. If the IRS does not like it I can transfer it to a SDB
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