How to Rollover a TSP to a Precious Metals IRA
The TSP is the largest defined-contribution retirement plan in the world, with over $900 billion in assets as of 2025.
01Executive Overview
A TSP rollover to a Precious Metals IRA is a non-taxable transfer that preserves your tax-deferred status while giving you expanded investment options and custodian flexibility. This guide follows the procedural framework of IRS Publication IRS Notice 2009-68 (TSP Rollover Guidance) and IRC Section 408.
Source Account: TSP
- Governing Code
- Federal Employees' Retirement System Act of 1986 (FERSA), administered by the Federal Retirement Thrift Investment Board (FRTIB)
- Plan Category
- defined contribution
- Tax Character
- pre-tax (traditional) or post-tax (Roth TSP)
- Sponsor Type
- federal government (civilian and uniformed service members)
- 2026 Contribution Limit
- $23,500 (+$7,500 catch-up age 50+)
- Rollover Trigger
- Separation from federal service (retirement, resignation, or removal), or reaching age 59½ while still employed (for in-service withdrawals). Special rules apply for required minimum distribution age.
Destination Account: Precious Metals IRA
- Account Class
- precious metals ira
- Tax Character
- pre-tax (traditional) or post-tax (Roth)
- Setup Time
- 5–15 business days from rollover to physical metal confirmed at depository
- Minimum to Open
- $5,000–$25,000 depending on custodian and metal type
- RMD Implication
- Subject to RMDs at age 73
- Rollover Acceptance
- Precious Metals IRAs accept rollovers from all qualified plans. The term 'Precious Metals IRA' encompasses Gold, Silver, Platinum, and Palladium IRAs — each governed by the same IRC Section 408(m)(3) fineness requirements.
02Eligibility Rules
Before initiating a TSP–to–Precious Metals IRA rollover, confirm that both the source plan and the destination account meet IRS eligibility requirements.
Separation from federal service (retirement, resignation, or removal), or reaching age 59½ while still employed (for in-service withdrawals). Special rules apply for required minimum distribution age.
Only your vested balance is eligible for rollover. FERS employees are immediately vested in their own contributions and vested in the 1% automatic agency contribution after 3 years of service. Uniformed service members are immediately vested in all contributions. Request a current vested balance statement from the plan administrator before initiating the rollover.
The TSP allows loans (General Purpose loans and Primary Residence loans). Upon separation from federal service, outstanding TSP loans must be repaid within 90 days or they are taxed as distributions. TSP loans cannot be rolled over. Contact the plan administrator to confirm your loan status before submitting a rollover request.
Precious Metals IRAs accept rollovers from all qualified plans. The term 'Precious Metals IRA' encompasses Gold, Silver, Platinum, and Palladium IRAs — each governed by the same IRC Section 408(m)(3) fineness requirements.
The Precious Metals IRA must be held by an IRS-approved self-directed IRA custodian under IRC Section 408(a). Open the receiving account before contacting your TSP plan administrator.
Gold must be at least 99.5% pure (exception: American Gold Eagle at 22-karat). Silver: 99.9%. Platinum and palladium: 99.95%. All metals must be stored at an IRS-approved depository — home storage is a prohibited transaction under IRC Section 4975.
Federal employees can access their TSP after separation from service at any age. Retired military members have separate TSP access rules. Civilian FERS employees who separate after age 55 avoid the 10% early withdrawal penalty — a one-year advantage over the standard age 59½ threshold that applies to IRAs and most other qualified plans.
— IRS Notice 2009-68 (TSP Rollover Guidance)
03Step-by-Step Rollover Process
The IRS-preferred rollover method is a direct rollover (trustee-to-trustee transfer) — the check is made payable to the new custodian, not to you. This eliminates the mandatory 20% federal withholding and the 60-day deadline risk entirely.
- 1
Open the Precious Metals IRA Account First
Open the receiving Precious Metals IRA account before contacting your TSP plan administrator. The distributing plan needs the receiving custodian's name, mailing address, and FBO account number to process a direct rollover. Without this information, the plan cannot complete the direct rollover and may default to an indirect rollover.
Setup time: 5–15 business days from rollover to physical metal confirmed at depositoryYou'll need:- Government-issued ID
- SSN
- SDIRA application
- IRS-approved depository selection
- Rollover or transfer from existing retirement account
Select an IRS-approved SDIRA custodian (e.g., Equity Trust, Directed IRA, IRA Financial). Verify the custodian is chartered under IRC Section 408(a) before opening. - 2
Request a Direct Rollover from Your TSP
Contact your TSP plan administrator and use the words "direct rollover" explicitly. Provide:
- The receiving custodian's full legal name
- The FBO format:
[Custodian Name] FBO [Your Full Name] Precious Metals IRA - The receiving account number
- The custodian's mailing address
TSP direct rollovers are processed through the TSP's own distribution form (Form TSP-70 for full withdrawal or TSP-77 for partial). The TSP is administered by the FRTIB — not a commercial custodian — and has its own processing queue. Allow 7–10 business days for the TSP to process the request after receiving complete paperwork.
TSP-specific: Use Form TSP-70 (full withdrawal) or TSP-77 (partial withdrawal) at My Account on tsp.gov. Processing takes 7–10 business days under normal conditions; allow 3–4 weeks in January–March. - 3
Verify the Check Payee
When the distribution check arrives — whether mailed to you for forwarding or directly to the custodian — verify the payee before accepting or forwarding it. The check must be payable to the new custodian, not to you personally.
✓ CorrectFidelity FBO Jane Smith IRA #123456789✗ Incorrect (Triggers 20% Withholding)Jane SmithIf the check is made payable to you personally, contact the plan administrator immediately. Do not deposit it into a personal bank account — doing so converts it into an indirect rollover subject to 20% withholding and the 60-day deadline.
- 4
Deposit as a Rollover Contribution
When delivering the check or wire to the receiving custodian, specify it as a "rollover contribution" — not a regular annual IRA contribution. This critical coding ensures the amount is not counted against your 2026 IRA contribution limit (standard annual limits).
Identical to Gold IRA process: open SDIRA, fund via direct rollover, direct custodian to purchase specific IRS-approved metals from approved dealer, confirm storage at IRS-approved depository.
Posting time after receipt: 5–10 business days for gold and silver; platinum and palladium may take slightly longer due to thinner markets - 5
Submit an Investment Direction Letter
Once the cash is credited to your SDIRA, the custodian holds funds in your account but does not invest them automatically. You must submit an Investment Direction Letter (IDL) authorizing the specific alternative asset purchase.
Same custodian pool as Gold IRAs — most SDIRA custodians that handle Gold IRAs also handle silver, platinum, and palladium. Confirm the custodian's approved dealer list for each metal type before initiating the rollover.
IRS Fineness Standards
Metal Minimum Purity Example Approved Products Gold 99.5% American Gold Buffalo, Canadian Maple Leaf; American Gold Eagle (22K — statutory exception) Silver 99.9% American Silver Eagle, Canadian Silver Maple Leaf Platinum 99.95% American Platinum Eagle, Canadian Platinum Maple Leaf Palladium 99.95% American Palladium Eagle, Canadian Palladium Maple Leaf - 6
Confirm Tax Documentation
In January of the following year, verify you receive:
- Form 1099-R from the TSP plan — shows the gross distribution with Distribution Code G (direct rollover). Report on Form 1040 Line 5a with $0 on Line 5b — write 'ROLLOVER' on the dotted line.
- Form 5498 from the receiving Precious Metals IRA custodian — issued by May 31, confirms the rollover contribution was received and properly coded.
04Processing Timeline
Most TSP–to–Precious Metals IRA rollovers complete in 7–10 business days from request submission to funds credited at the receiving institution. The timeline varies significantly by plan administrator and asset type.
Open Receiving Account
Open Precious Metals IRA at the chosen custodian. Receive account number.
5–15 business days from rollover to physical metal confirmed at depositorySubmit Rollover Request
Contact TSP plan administrator with receiving custodian's FBO information. Request direct rollover in writing.
1 business dayPlan Administrator Processing
Plan administrator verifies eligibility, vesting, and outstanding loans. Prepares distribution check or wire.
7–10 business daysCheck or Wire Transfer
Plan issues check (3–5 postal days) or wire (same business day). Wire transfers are strongly recommended for large balances to eliminate postal delay and lost-check risk.
1–5 business daysCustodian Posts Rollover
Receiving Precious Metals IRA custodian credits the rollover contribution. Funds available for investment or investment direction.
1–3 business daysInvestment Direction Executed
Submit Investment Direction Letter. Custodian processes and executes the alternative asset purchase.
5–10 business days to metal confirmed at depositoryThe 60-day window begins on the date you receive the distribution check — not the date it was issued or postmarked. For direct rollovers, no 60-day deadline applies. If you receive a check payable to you, you have exactly 60 calendar days to deposit 100% of the gross amount (including the 20% withheld) into the new account. Missing the deadline by even one day creates a taxable event with no automatic remedy.
05Tax & Penalty Guide
Direct Rollover Tax Summary
Why This Rollover Is Tax-Free
Same tax treatment as a Gold IRA — rolling a pre-tax qualified plan to a traditional Precious Metals IRA is non-taxable. The metals held are simply the assets within the IRA structure.
Traditional: tax-deferred growth. Roth: tax-free growth and distributions. All physical precious metals held in an IRA — regardless of metal type — are taxed as ordinary income when distributed (not at capital gains rates). This is a meaningful tax disadvantage relative to holding physical metals outside an IRA, where long-term capital gains rates of 28% (collectibles rate) apply.
Early Withdrawal Penalty: 10% federal penalty plus ordinary income tax for distributions before age 59½
The 10% early withdrawal penalty (IRC Section 72(t)) applies only to taxable distributions taken before age 59½ — not to direct rollovers. The following exceptions eliminate the penalty even on early taxable distributions:
- separation from service at age 55 or older (FERS civilian) or age 50 for public safety employees
- 72(t) SEPP
- disability
- death
- TSP hardship withdrawal (though this is taxable and penalizable)
Federal employees who contributed to both FERS (the pension) and the TSP have a layered retirement income structure. The TSP rollover decision is often driven by the desire to hold alternative assets — Gold IRAs, real estate IRAs — that are not available within the TSP's index fund menu.
06IRS Reporting Requirements
Every retirement account rollover — including non-taxable direct rollovers — requires reporting on your federal tax return. Failing to report a rollover, even a tax-free one, triggers the IRS's Automated Underreporter (AUR) program to propose tax on the full distribution amount.
Distribution Report
Issued by your TSP plan. Shows the gross distribution (Box 1) and Distribution Code in Box 7.
- Line 5a = Box 1 amount ($200,000 example)
- Line 5b = $0 — write "ROLLOVER" on the dotted line
Rollover Confirmation
Issued by your Precious Metals IRA custodian. Confirms the rollover was received and properly coded in Box 2 (rollover contributions) or Box 3 (Roth conversion amount).
IRS Publications Referenced in This Guide
- IRS Notice 2009-68 (TSP Rollover Guidance) — governing rules for the TSP
- IRC Section 408(m)(3) (Precious Metals IRA eligibility and fineness requirements) — governing rules for the Precious Metals IRA as receiving account
- IRS Publication 575 (Pension and Annuity Income)
- IRS Notice 2009-68 — Safe Harbor Explanation for Eligible Rollover Distributions
07Custodian & Compliance Rules
The Precious Metals IRA requires an IRS-approved self-directed IRA custodian and strict compliance with IRC Section 4975 prohibited transaction rules. The custodian takes legal title to the assets — the account holder never holds them personally.
Custodian Selection Guide
Confirm that your chosen custodian explicitly supports the specific metals you plan to hold. Most Gold IRA custodians also handle silver; fewer have deep expertise in platinum and palladium transactions. Request a full approved dealer list and pricing schedule for all four metals before committing.
- Equity Trust — supports all four metals; established market leader
- Directed IRA — competitive flat-fee pricing for multi-metal accounts
- GoldStar Trust — specialized precious metals focus across all metal types
- Kingdom Trust — institutional platform for larger accounts
Prohibited Transaction Rules — IRC Section 4975
Silver's storage requirements are disproportionate to its dollar value — approximately 80 ounces of silver equal the value of 1 ounce of gold, but silver takes 80 times the physical storage space. Storage fees for silver-heavy precious metals IRAs can represent a higher percentage of account value than gold-heavy accounts. Model the storage cost impact before allocating heavily to silver.
IRS Storage Requirements
Physical precious metals must be stored at an IRS-approved depository. Home storage of IRA metals — regardless of any LLC or trust structure — is a prohibited transaction confirmed by the U.S. Tax Court in McNulty v. Commissioner, 157 T.C. No. 10 (2021). The consequence is immediate taxation of the full IRA value.
Permitted Assets in Your Precious Metals IRA
✓ Permitted
- IRS-approved gold (99.5% fineness minimum)
- IRS-approved silver coins and bars (99.9% fineness minimum — American Silver Eagle, Canadian Silver Maple Leaf, Silver bars from LBMA-approved mints)
- IRS-approved platinum (99.95% fineness — American Platinum Eagle, Canadian Platinum Maple Leaf)
- IRS-approved palladium (99.95% fineness — American Palladium Eagle, Canadian Palladium Maple Leaf)
✗ Prohibited
- Non-approved coins and bars below IRS fineness thresholds
- Numismatic or collectible coins regardless of metal content
- Home-stored metals
- Silver rounds from non-LBMA-approved mints
083 Costly Mistakes to Avoid
These are the most common — and most expensive — errors investors make when rolling over a TSP to a Precious Metals IRA. Each is preventable with the right procedural knowledge.
Rolling out of the TSP too quickly and losing access to the G Fund
The TSP G Fund (Government Securities Investment Fund) is one of the only risk-free, interest-bearing funds available to retail retirement investors. It earns the rate of long-term Treasury securities with no risk of principal loss. Once you roll out of the TSP to an IRA, you permanently lose access to the G Fund — there is no equivalent commercial product. Some financial advisors recommend keeping a portion in the TSP even in retirement specifically to preserve G Fund access.
Purchasing silver rounds from non-LBMA-approved mints
Many silver coins and rounds that appear to meet the 99.9% fineness requirement are not eligible for an IRA because they are produced by mints that are not on the London Bullion Market Association (LBMA) approved refiner list. The IRS requires that silver bars and rounds come from LBMA-approved producers. Non-approved silver rounds — regardless of their purity — are treated as prohibited collectibles in an IRA.
Not accounting for the proportional distribution rule when rolling over
If your TSP account holds both traditional and Roth balances, every distribution is taken proportionally from both. You cannot elect to roll only the traditional TSP to a traditional IRA while leaving the Roth TSP in place. This complicates tax planning and should be mapped out with a CPA before initiating any distribution.
The TSP is governed by FERSA and administered by the Federal Retirement Thrift Investment Board (FRTIB), an independent government agency. Unlike commercial 401(k) plans, the TSP is not subject to ERISA — it operates under federal statute. Rollovers from the TSP are governed by IRC Section 402(c) and IRS Notice 2009-68.
09Frequently Asked Questions
- Should a federal employee roll over their TSP to an IRA after retirement?
- It depends on investment goals. The TSP's primary advantages are its ultra-low expense ratios (as low as 0.04%) and the unique G Fund. The primary advantage of rolling to an IRA is investment flexibility — access to individual stocks, bonds, Gold IRAs, Self-Directed IRAs, and thousands of mutual funds not available in the TSP. Most financial advisors recommend rolling if you want alternative assets or a specific investment strategy; staying in the TSP if low cost and simplicity are priorities.
- Can a military service member roll over a TSP?
- Yes. Uniformed service members who separate from the military can roll their TSP to a traditional IRA, Roth IRA, or another eligible employer plan. Military members who separated before age 55 are subject to the 10% early withdrawal penalty on non-rollover distributions — but rollovers to an IRA avoid this entirely.
- How long does a TSP rollover take?
- The FRTIB typically processes distribution requests within 7–10 business days of receiving complete paperwork. Add 3–5 business days for the receiving IRA custodian to credit the funds. Total processing time is generally 10–21 business days. Requests submitted during peak periods (January–March) may take longer.
- Can I hold silver, platinum, and palladium in the same IRA as gold?
- Yes — a single self-directed IRA (Precious Metals IRA) can hold all four IRS-approved metals: gold, silver, platinum, and palladium. Each metal must meet the IRS fineness standard for its type. The metals are held in the same IRS-approved depository and appear on the same account statement.
- What is the IRS fineness requirement for silver in an IRA?
- Silver held in an IRA must be at least 99.9% pure (0.999 fineness). Approved options include American Silver Eagles, Canadian Silver Maple Leafs, Austrian Silver Philharmonics, and silver bars from LBMA-approved refiners. Silver rounds from non-LBMA-approved mints do not qualify regardless of their stated purity.
- Is silver a better IRA investment than gold?
- Silver and gold serve different roles in a portfolio. Gold is primarily a monetary metal and inflation hedge with lower volatility. Silver has significant industrial demand (solar panels, electronics, medical applications) alongside its monetary role, creating higher price volatility and potentially higher returns in bull markets — but also larger drawdowns. Neither is universally 'better' — their optimal allocation depends on investment thesis, timeline, and risk tolerance.
- Is there a deadline to roll over a TSP after leaving my employer?
- There is no IRS deadline to initiate a rollover after a triggering event. The 60-day rule only applies once a distribution has been issued to you. However, plan administrators may force distributions for balances under $7,000 within 12–18 months of separation. Address the rollover within 60–90 days to maintain administrative control.
- Does a direct rollover count against my annual IRA contribution limit?
- No. Rollover contributions are separate from and do not count against the annual IRA contribution limit ($7,000 in 2026; $8,000 for those age 50+). A $400,000 rollover into a Precious Metals IRA does not affect your ability to make a regular annual contribution to the same account.