As discussed in last week’s blog post, which can be found here: Investing in Precious Metals with your Self-Directed Solo 401(k) – Part 1, our self-directed solo 401(k)s allow account holders/plan sponsors to diversify their retirement account into certain precious metals. This post lists some common metals that are allowed and disallowed, per the IRS*.
Allowed Precious Metals Include: Bars and Rounds (produced by manufacturers accredited by Nymex/Comex, LME, LBMA, NYSE/Liffe/CBOT, and ISO-9000 or a national mint with the required minimum finesses as outlined below:
GOLD - .995+ purity (minimum finesses for bars)
American Eagle Coins (but coins such as the American Eagle, that have undergone “certification”, aka “slabbed” coins, are not acceptable in self-directed solo 401(k)s at this time.)
Australian Kangaroo/Nugget coins
Austrian Philharmonic coins
Canadian Maple Leaf coins
Credit Suisse-Pamp Suisse Bars .999
U.S. Buffalo Gold Uncirculated coins (no Proofs)
PLATINUM - .9995+ purity (minimum finesses for bars)
American Eagle coins (however, coins including the American Eagle, that have undergone “certification”–also known as “slabbed” coins–are not acceptable in Solo 401k at this time.
Australian Koala coins
Canadian Maple Leaf coins
Isle of Man Noble coins
SILVER - .9995+ purity (minimum finesses for bars)
American Eagle coins (however, coins including the American Eagle, that have undergone “certification”–also known as “slabbed” coins–are not acceptable in Solo 401k at this time)
Australian Kookaburra coins
Austrian Vienna Philharmonic coins
Canadian Maple Leaf coins
Mexican Liberated coins
PALLADIUM - .9995+ purity (minimum finesses for bars)
Disallowed Precious Metals Include:
Austrian 100, 20 and 10 Corona
Belgian 20 Franc
British Britannia
Chilean 100 Peso
Columbian 5 Peso British Sovereign
Dutch 10 Guilder
Franc 20 French
Hungarian 100 Korona
Italian 20 Lira
Mexican 50, 20, 10, 5, 2 1/2 and 2 Peso
Rare or Collectible Coins
South African Krugerrand
Swiss 20 Franc
Many investors believe that having precious metals as an asset class in their retirement portfolio is a great advantage due to their value generally keeping up with, or exceeding, inflation rates. However, investing in coins or bullion also has its disadvantages. For example, there is no current gain or income received while the metal is being held, such as interest accrual or rental income from real estate. In addition, the coin market can often be sporadic.
IRC Sections Regarding Coins and Bullion
Additional information - the following code section references allowable types of coins in a retirement account: Section 408(m)(3)(A) of the IRC (Internal Revenue Code), and following that, code Section 408(m)(3)(B) defines the bullion standards.
*Laws and regulations can change at any time. Allowed and disallowed metals could change without warning. This post is provided for informational purposes only. Please do your own research and due diligence before investing in precious metals or any other asset.
