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Texas Approves Tax Exemption for Precious Metals

Texas Approves Tax Exemption for Precious Metals

John-Rothans

Written by John Rothans

Dec 2, 2019

Voters in Texas approved legislation that strengthens the case for precious metals in wealth diversification and IRA retirement strategies.

The Lone Star State’s “thumbs-up” on Proposition 9 means precious metals held in precious metals depositories are exempt from property taxation.

Precious metals depositories are facilities where owners can securely store their gold, silver, platinum, and other metals.

Traditionally, the state did not tax such holdings. The clear benefit here, however, is that the property tax exemption is now codified by state law. It’s an extra layer of financial protection for precious metals holders.

Texas isn’t the only state looking at the role precious metals play in the economy and personal wealth. Other states are examining legislative steps to help residents secure their money with precious metals.

IRA-Approved Precious Metals Options

The depository angle is a crucial element to keep in mind. That’s because the IRS dictates that precious metals cannot be held in a personal residence or even a bank’s safe-deposit box if they’re part of a self-directed IRA.

Rather, highly refined bullion can only be included in your IRA if it is “in the physical possession of a bank or an IRS-approved nonbank trustee,” writes the IRS.

Storing your IRA gold at home can be considered distribution. That means you may lose tax-deferred benefits and face a penalty if you’re under 59½ years old and store your gold at home.

According to the Wall Street Journal, the IRS “warns taxpayers to be wary of anyone claiming that precious metals held in your IRA can be stored at home or in a safe-deposit box.”

READ MORE: If storing your precious metals in a depository currently isn’t in the cards for you, here are additional ways to store them.

The Buildup to a Big Win

Here’s the complete Proposition 9 (HJR 95) language:

“The constitutional amendment authorizing the legislature to exempt from ad valorem taxation precious metal held in a precious metal depository located in this state.”

Media comments supporting the legislation highlight its many benefits:

Your Next Step

Call U.S. Money Reserve at 1-844-307-1589 to learn more about buying precious metals and storing them in a depository or incorporating precious metals into a self-directed IRA.

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