What Is the History of Gold IRAs in the United States?

1974 — ERISA and the birth of the IRA: The Employee Retirement Income Security Act of 1974 created the Individual Retirement Account, allowing workers without employer pension plans to contribute up to $1,500/year to a tax-deferred retirement account. The statute was broadly written and did not explicitly exclude precious metals — though the practical infrastructure for precious metals IRAs did not exist at the time.

1981 — ERTA and the collectibles prohibition: The Economic Recovery Tax Act of 1981 added IRC Section 408(m), which provided that any IRA investment in a "collectible" (broadly defined to include art, rugs, antiques, metals, gems, stamps, coins, alcoholic beverages, and other tangibles) would be treated as a distribution — taxable and subject to penalty. This effectively prohibited gold, silver, and coin collecting from IRAs.

1986 — Tax Reform Act: US coins carve-out: The Tax Reform Act of 1986 added the first precious metals exception to § 408(m)(3): gold and silver coins minted by the United States Treasury were excluded from the collectibles definition. At the time, the American Gold Eagle had just been introduced (first minted in 1986), and this provision specifically authorized its inclusion in IRAs.

1997 — Taxpayer Relief Act: Modern Gold IRA framework: The most significant expansion occurred in the Taxpayer Relief Act of 1997, which added subsection (B) to § 408(m)(3). This provision created eligibility for any gold, silver, platinum, or palladium bullion meeting specified fineness standards and in the physical possession of a qualified IRA trustee. It also added the American Gold Buffalo (before the coin existed, anticipating its eventual minting) and other specified coins. This 1997 expansion created the modern Gold IRA framework that allows foreign coins (Canadian Maple Leaf, Austrian Philharmonic, etc.) and bars from approved refiners.

2021 — McNulty v. Commissioner: The United States Tax Court's decision in McNulty v. Commissioner, 157 T.C. No. 10 (November 18, 2021), settled the contested question of home storage Gold IRAs. The court ruled that IRA-held American Gold Eagles stored in the account owner's home (through a checkbook LLC structure) constituted prohibited transactions, disqualifying the IRAs. This confirmed the IRS's longstanding position that all IRA-held precious metals must be in the physical possession of an IRS-approved trustee.