What Is a Cryptocurrency IRA? | Coin IRA

Want to know how to roll over your retirement account into a Digital Currency IRA?

When most investors think of IRA investments, they think of stocks, bonds, and conventional financial assets. Some investors who may have experience in precious metals investing may know that IRAs can be invested in gold and silver too, but most investors don’t know that the investment options available to them in a Self Directed IRA go far beyond equities and even precious metals. Aside from collectibles that are defined in federal law, there are many other assets that may be purchased with your IRA funds.

With the IRS declaring that Bitcoin and similar cryptocurrencies are property, and not securities or currencies, the ability for IRAs to invest in Bitcoin and cryptocurrencies was made dramatically easier. Investing in cryptocurrencies through an IRA is just as easy as investing in stocks, bonds, or precious metals.

A cryptocurrency IRA works the same way as any other IRA. If you choose to open a Traditional Cryptocurrency IRA, you can fund it with a rollover from an existing [re-tax retirement account or choose to make regular pre-tax contributions as with a conventional IRA. All the same contribution limits and tax treatment apply to a Traditional Cryptocurrency IRA as to a conventional Traditional IRA.

If you choose to open a Roth Cryptocurrency IRA, you would fund that IRA with post-tax dollars transferred or rolled over from an existing post-tax retirement account, or with post-tax contributions. Again, all the same contribution limits and tax treatment apply to a Roth Cryptocurrency IRA as to a conventional Roth IRA.

As with any other IRA, your assets are held by a custodian. That custodian is responsible for safeguarding your assets, tracking IRA activities such as 401(k) rollovers, transfers, and distributions, and reporting any IRA transactions to the IRS.

Like a conventional IRA, early withdrawals before you reach the age of 59 ½ may result in penalties and create a taxable event. And once you reach age 72, you may be required to start taking required minimum distributions (RMDs), depending on the type of IRA you have. It’s always best to consult your tax advisor for reliable information on the requirements for various types of retirement accounts you may hold.

Always consult your tax advisor
A Cryptocurrency IRA offers you an alternative to investing in stocks and bonds. It’s a way for you to diversify your retirement assets while maintaining the ability to grow the value of your assets. If you’re interested in learning more about the benefits of starting a cryptocurrency IRA, contact Coin IRA today.