Can an LLC Hold Precious Metals?

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Holding precious metals in an LLC owned by your IRA provides additional asset protection as any judgment creditor must go through it to reach them. This gives your assets greater safety.

Legality

An LLC for precious metals IRA allows investors to manage buying and selling of precious metals directly without incurring transaction fees from custodians, while providing greater asset protection as judgment creditors would have to sue the LLC before accessing assets held within it.

Reputable precious metals dealers ensure that clients understand all of the implications associated with holding physical precious metals in an IRA-owned LLC structure. While such structures are legal, owners need to be mindful of potential scams.

Many of these scams involve precious metals dealers that prey upon IRA holders using hard-nosed sales techniques designed to instill fear about government interference and economic collapse. One such Los Angeles-based dealer called Safeguard Metals lured hundreds of investors by advertising its precious metals products on conservative radio shows hosted by Sean Hannity and Mark Levin.

Taxes

IRS rules and guidelines pertaining to precious metal investments can be complex. Seeking advice from an experienced tax specialist may help ensure compliance with all regulations, as well as ensure safe storage for precious metal investments.

Precious metals offer investors low correlation to markets and economies. Furthermore, their unique properties make them effective diversifiers in portfolios: their pro-cyclical sources of demand increase in step with economic expansion while countercyclical sources come online during slowdowns or market pullbacks.

An LLC also provides more protection in the event of a lawsuit. When sued, judgment creditors can only pursue assets owned by the LLC itself and must fight to get at your gold or silver investments. As such, we recommend creating an IRA-owned LLC structure for precious metal investments (commonly referred to as Gold IRA LLCs or Precious Metals IRA LLCs) so you can manage transactions yourself without incurring additional transaction fees with every purchase transaction.

Asset Protection

Precious metals are often seen as an insurance against financial downturns that many fear. While stocks, bonds and mutual funds do not entail personal liability issues, precious metals are considered liability assets.

Holding precious metals in an LLC provides some degree of protection; however, courts can pierce through and seize personal assets if they deem it appropriate.

To better protect yourself if this should ever be necessary, consider moving your precious metals into an offshore asset protection trust. This will offer greater privacy than when holding onto them directly through either your name or living trust.

Make sure that the LLC owns enough insurance coverage to safeguard any real property it owns in case of litigation, so as to be protected should a claim arise against it. Make sure it includes your company as a named insured so as to be covered should something arise that threatens it.

Chain of Title

Many precious metal investors entrust a gold or silver IRA LLC with their precious metal purchases and storage needs, providing greater asset protection than if using traditional structures such as an LLC would. Unfortunately, judgment creditors could still gain entry through breaching this barrier to access your personal assets.

A chain of title is an historical account of ownership transfers for real estate property, from its current owner back to the original one. Though other documents exist to prove current ownership such as deeds or titles, chain of title documents provide crucial proof in cases when your rights to own are put into question.

Precious metal investments involve more complex title chains because the details may not be so evident as with deeds or titles. To make sure that your precious metal investment has a transparent chain of title, purchase from an NYMEX or COMEX-approved refiner – this will guarantee clean title to them!


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