A Self-Directed Cryptocurrency IRA must follow all the same rules as any other Individual Retirement Account. You can make regular, tax-advantaged contributions to an IRA that is set up and administered by a custodian. However, rather than investing in traditional investments like stocks and bonds, you invest your savings in cryptocurrency, also known as digital currency.
How does a Cryptocurrency IRA work?
Investing in cryptocurrencies through a Self-Directed Cryptocurrency IRA is similar to investing in other types of alternative assets in a self-directed IRA. Once you establish the type of account you want to open (Traditional, Roth, SEP, SIMPLE), you will decide how your Cryptocurrency IRA will be funded. You can then transfer funds from an existing IRA, rollover funds from a 401k or other eligible employer-sponsored plan, or make a contribution according to the guidelines set forth by the IRS. Once your funds are credited to your new Cryptocurrency IRA, you can buy and sell cryptocurrency inside your IRA, taking advantage of all the tax benefits an IRA can offer, shielding your principal and profits from income tax until you take a distribution. The digital assets purchased will be stored by your Cryptocurrency IRA custodian, as required by the IRS.How do I know if I’m eligible to set up an account?
To be eligible to establish an account on the Coin IRA Cryptocurrency Trading Platform, you must:- Be a US Citizen with a Social Security number.
- Have a legal address located within the United States.
- Be over the age of 18.
- Have a statement or online access to the account(s) you will be funding your new account from.
How can I help speed up the funding process of my IRA?
If you are funding your new Cryptocurrency IRA with a transfer from an existing IRA, please ensure that that the amount you want to transfer from your existing IRA account is already liquidated and sitting in an uninvested cash position and provide us with an account statement or document that shows:- The name and phone number of your current custodian from your statement or online access
- Your name EXACTLY as it appears your account registration (for example Mr. John Smith, Sr. versus Mr. John Smith, III)
- Your account number and the type of account (e.g., Roth or Traditional IRA)
This ensures the expediency of the funding process.
If you are funding your new Cryptocurrency IRA with a rollover from a 401k or other employer-sponsored plan, provide an account statement or document that shows:- Your plan details and account number
- The name and phone number of your current plan administrator or trustee from your statement or online access
- Your name EXACTLY as it appears your account registration (for example Mr. John Smith, Sr. versus Mr. John Smith, III)
With an employer-sponsored plan, there is no need to liquidate assets in advance.
If you are funding your new Cryptocurrency IRA with a contribution, just let us know the amount and the tax year the contribution is for. Funding instructions will be emailed to you based on your choice of how you want to send the funds.