What is the difference between a rollover, a transfer, and a conversion?
A transfer moves money directly between two IRAs of the same type and is never reported as a distribution. A rollover moves money out of an employer plan or between accounts with a distribution event. A conversion changes pre-tax money into Roth money and is taxable.
Three different mechanisms get described loosely as "moving my retirement money," and the IRS treats each one differently. Getting the vocabulary right in advance is the cheapest form of tax planning available to you.
A transfer moves assets directly between two IRA custodians of the same tax character. It is not a distribution, it is not reported to you on Form 1099-R as taxable, and you can do as many as you like in a year.
A rollover moves money out of an employer- sponsored plan, a 401(k), 403(b), governmental 457(b), or the federal Thrift Savings Plan, into an IRA. Done directly, it is generally not taxable. Done indirectly, a clock starts.
A conversion changes the tax character of the money by moving pre-tax dollars into a Roth account. That is a deliberate taxable event, and it should never happen by accident during a rollover.
For the underlying account mechanics, custodians, depositories, and eligible metal, read the self-directed Gold IRA guide alongside this page.
What is the difference between a direct and an indirect rollover?
In a direct rollover the plan sends funds straight to the new custodian, with no withholding and no deadline risk. In an indirect rollover the check comes to you, 20 percent is typically withheld from employer plans, and the full pre-withholding amount must be redeposited within 60 days.
In a direct rollover, your plan administrator sends the funds straight to the new IRA custodian. Any check is made payable to the custodian for your benefit, not to you. No withholding applies, no deadline applies, and the transaction is reported as a non-taxable rollover.
In an indirect rollover, the plan pays you. From that moment you have 60 calendar days to deposit the money into an eligible IRA. Miss the window and the entire amount is treated as a distribution, ordinary income tax, plus a 10 percent additional tax if you are under 59½ and no exception applies.
The 20 percent withholding trap
Employer plans are generally required to withhold 20 percent for federal income tax on an eligible rollover distribution paid to you. Suppose your balance is $100,000. The plan sends you $80,000 and remits $20,000 to the IRS. To complete a fully tax-free rollover you must deposit $100,000 into the new IRA within 60 days, which means funding that missing $20,000 out of your own pocket and waiting until you file to recover it.
If you only deposit the $80,000 you received, the $20,000 shortfall becomes a taxable distribution. This is the single most expensive mistake in the category, and it is entirely avoidable by choosing a direct rollover.
The one-per-12-month rule
You may complete only one IRA-to-IRA indirect rollover in any rolling 12-month period, counted across all IRAs you own, not per account. Direct trustee-to-trustee transfers and direct rollovers from employer plans are not counted against that limit, which is one more reason to keep every move direct.
Which retirement accounts can be rolled into a gold IRA?
Traditional, Roth, SEP, and SIMPLE IRAs can generally transfer, and 401(k), 403(b), 457(b), and TSP balances can usually roll over once you have separated from the employer or the plan allows in-service distributions. SIMPLE IRAs carry a two-year waiting rule.
Eligibility is decided by two things: the type of plan, and whether you have a distributable event under that plan's document.
Former-employer plans
A 401(k), 403(b), or governmental 457(b) left behind at a previous employer is normally the most straightforward case. You have separated from service, so the balance is generally eligible to roll to an IRA in whole or in part.
Current-employer plans
While you are still employed, most plans restrict rollovers. Some permit an in-service distribution at age 59½, and some permit rollovers of specific money sources such as after-tax or rollover contributions. Your plan administrator, not your dealer, is the authority on what your plan allows.
The Thrift Savings Plan
Separated federal employees and eligible service members can generally roll TSP balances to an IRA, and age-based in-service withdrawals are available in some circumstances. The TSP uses its own forms and its own processing timeline, which typically adds a week or so to the sequence.
Existing IRAs and SEP or SIMPLE accounts
Traditional, SEP, and rollover IRAs move by direct transfer. SIMPLE IRAs have a two-year rule from the date of first contribution before they can move to a non-SIMPLE IRA without adverse tax consequences. Roth IRAs move to Roth self-directed IRAs. Contribution limits and the two-year rule for these accounts are covered in Gold IRA for the self-employed.
How long does a gold IRA rollover take?
A typical rollover takes two to four weeks end to end: a few days to open the self-directed account, one to three weeks for the releasing plan to send funds, then a few days to price, purchase, and deliver metal into the depository under the account's name.
Most Dormy clients go from first conversation to metal in storage in roughly two to four weeks. The variable is almost never the dealer or the depository, it is how quickly the releasing plan administrator acts.
Account opening with a self-directed custodian typically takes a few business days. The rollover request itself is where time is spent: some administrators process electronically within a week, others still mail a physical check and require a notarized spousal consent form first.
Once funds settle, pricing and purchase happen on a single recorded call, and shipment to the depository is insured in transit. Nothing about that final step should feel rushed.
Can an IRA be rolled into gold directly?
Cash moved from a 401(k) or brokerage IRA can fund a self-directed IRA that then buys eligible metals. Existing IRA-owned metals may instead transfer in kind, without a sale, when the receiving custodian accepts the holdings. Have the custodians coordinate the transfer while the metals remain under IRA custody. Metals you own personally outside an IRA cannot be contributed as a regular IRA contribution.
For a cash-funded move, funding the IRA and buying metal are separate steps. The first transaction is the movement of money between custodians, the part with the tax rules, the clocks, and the withholding traps. The second transaction is the purchase of metal inside the receiving account, which has no deadline at all.
Keeping those two steps separate in your mind protects you twice over. It keeps the tax mechanics clean, and it removes any justification for being rushed into a coin selection while your cash is still in transit. Which metals qualify once the funds land is covered in IRA-eligible metals.
Why would you not roll a 401(k) into an IRA at all?
Employer plans carry benefits an IRA cannot replicate: ERISA-based federal creditor protection, possible penalty-free access from age 55 if you leave that employer, institutional pricing on some funds, and in-plan loan provisions. An honest evaluation weighs those against what the IRA offers before anything moves.
Most rollover content is written by firms that only get paid if you move the money. The question worth asking first is whether you should. There are real, documented reasons people reasonably leave a 401(k) where it is.
Creditor protection. Assets inside an ERISA- covered employer plan carry broad federal protection from creditors. IRA protection is largely a matter of state law and varies considerably. If asset protection is a live concern for you, raise it with a qualified attorney before you roll anything.
The age-55 provision. If you separate from an employer in or after the year you turn 55, that plan's balance can often be accessed without the 10 percent early-distribution additional tax. Once rolled into an IRA, that specific provision no longer applies to the money, the IRA's own 59½ rule takes over.
Plan-level pricing and features. Some large plans hold institutional share classes with lower expenses than retail equivalents, and some offer stable-value funds or loan provisions an IRA does not have.
None of this argues against a rollover in the general case. It argues for a partial, deliberate move sized to a real allocation decision, which is exactly how a diversified retirement account should change.
Should you roll your entire 401(k) into gold?
No, and be wary of anyone who suggests otherwise. Physical metal is a non-yielding asset with storage and custodial costs, intended to complement income-producing holdings. A partial rollover that leaves the rest of the account diversified is the standard, prudent structure.
Gold pays no dividend and no interest. Its role in a retirement account is diversification and a store of value, not income. A retirement plan concentrated in any single asset class, including metal, takes on avoidable risk.
Partial rollovers are common, are permitted by most plans, and are usually the correct mechanism. How much belongs in metal is a function of your age, timeline, other holdings, and income needs, a conversation for you and a qualified financial or tax professional, not a number a dealer should hand you. The dealer's job is execution quality and transparent pricing, not setting your allocation.
What does a gold IRA rollover cost?
Ask for four numbers in writing before you sign: the dealer premium over spot, the account setup fee, the annual custodian fee, and the annual storage and insurance fee. A releasing plan may also charge a small outgoing distribution or wire fee.
A rollover itself usually carries no fee from the releasing plan, though some administrators charge a small distribution processing fee. The costs that matter are on the receiving side and on the metal.
Expect a custodian account-setup fee, an annual custodial administration fee, an annual depository storage fee, and the premium over spot on whatever you buy. That last item is the largest number in the transaction and the one most often obscured. Our typical premium ranges are published so you can compare before you commit, and how to read a quote walks through an annotated example line by line.
Where do gold IRA rollovers go wrong?
The recurring failures are the same: choosing an indirect rollover unnecessarily, missing the 60-day deadline, forgetting that withheld 20 percent must be replaced from other funds, mistitling the receiving account, and buying high-premium coins before the paperwork is even settled.
Requesting funds before the destination exists. Open the self-directed IRA first. A check arriving with no account to receive it is how 60-day deadlines get missed.
Accepting a check payable to you. If the payee line has your name on it and not the custodian's, you are in an indirect rollover whether you intended one or not.
Commingling Roth and pre-tax dollars. Keep them in separate destination accounts. Untangling basis later is far more expensive than opening a second account now.
Being steered into high-premium coins at settlement. A rollover creates a large cash balance at a predictable moment, and some firms treat that moment as a sales opportunity for proof or numismatic product with much wider spreads. Read proof coins vs. bullion: premiums and resale value before that call happens.
Moving everything at once. A rollover does not have to be all-or-nothing. Partial moves are common and keep your retirement savings diversified across asset classes.
Home storage promises. Metal owned by an IRA must sit with a qualified trustee or approved depository. Any pitch that ends with the coins in your house is describing a deemed distribution. Gold IRA storage rules covers what is actually permitted.
What should you ask before signing rollover paperwork?
Ask who the custodian and depository are, what the premium over spot is on each item, whether the account is titled to the IRA rather than to you, how buyback pricing is determined, and what the total first-year and ongoing annual cost will be.
Ask who the custodian is and whether they are independent of the dealer. Ask for the total first-year cost in dollars, not percentages. Ask what the same dollar amount buys in ounces across two different products. Ask what the buyback spread would be if you sold tomorrow.
A fuller list lives at ten questions that end bad sales calls. Every one of them has a documented answer at Dormy.
Where can you verify the rollover rules yourself?
The IRS publishes the rollover, 60-day, withholding, and one-per-year rules on its Rollovers of Retirement Plan and IRA Distributions page, and FINRA publishes investor bulletins on buying physical metals and on the fraud risks specific to self-directed IRAs.
Every claim in this guide can be checked against the primary sources:
- IRS, Rollovers of Retirement Plan and IRA Distributions , the 60-day rule, the one-rollover-per-12-month limit, and the mandatory 20 percent withholding on indirect rollovers from employer plans.
- FINRA, Buying Physical Gold or Other Metals , the questions regulators expect you to ask about fees, markups, liquidity, and storage before you buy.
- FINRA, Self-Directed IRAs and the Risk of Fraud , why a self-directed custodian does not vet your investments, and what that means for how carefully you should vet the dealer.
If a dealer's explanation of the rules conflicts with the IRS page, believe the IRS page.
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