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Bitcoin IRA Review: Tax-Deferred Investing in Crypto & Gold

Review Updated
Dana Sitar
Author: Dana Sitar
Dana Sitar
Dana Sitar
Dana Sitar (@danasitar) has been writing and editing since 2011, covering personal finance, careers, and digital media. She trains journalists, writers, and editors on writing for the web and has written about finance and careers for publications including The New York Times, HuffPost, and a column for Inc. Magazine.

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Bitcoin IRA is a self-directed trading platform that lets you buy and sell cryptocurrencies within a tax-advantaged individual retirement account (IRA). The platform helps you roll over existing retirement accounts into a crypto IRA, and it also offers gold investing. While you can save money on taxes this way, there are expensive account fees. Read our full Bitcoin IRA review to find out if it's worth using to save for retirement.

Ratings Methodology

Bottom Line

Bitcoin IRA's tax-deferred crypto and gold investing is a simple way to diversify your retirement savings, but the fees are high, and volatility could also be an issue

Fees:

0.99%-2.99% deposit fee, 2% transaction fee, 0.08% monthly security fee

Account Minimum:

$1,000

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Full Bitcoin IRA review

This cryptocurrency IRA is a good fit for: Investors who want to add cryptocurrency to their retirement funds and get the tax benefits of an IRA.

Pros

  • Tax-deferred crypto investing
  • Gold investing
  • Full-service IRA rollover
  • Large selection of cryptocurrencies
  • U.S. regulated
  • Educational content

Cons

  • Expensive fees
  • Lack of fee transparency
  • No crypto deposits

Top perks

Tax-deferred crypto investing

Because it's a self-directed IRA, Bitcoin IRA provides tax advantages over buying crypto with a broker or crypto exchange. Like any traditional IRA, your contributions are tax deductible in the year you make them. You'll only pay taxes when you withdraw funds.

Just remember that those tax savings require you to give up some flexibility. Since an IRA is a retirement account, withdrawals made before the age of 59 ½ will result in early withdrawal penalties and are subject to income taxes.

Looking for more alternative assets? Check out Motley Fool Money's Rocket Dollar Review.

Gold investing

In addition to digital currencies, you can also buy gold through Bitcoin IRA. The fees and buying process work the same as with crypto, except you're buying ownership rights to physical gold bars.

This is one of the faster and easier ways to invest in gold, especially since you don't need to pay costly storage fees like other gold brokers charge. Bitcoin IRA stores gold in Brink's bullion vaults, where it's also insured.

LEARN MORE: How to Invest in Gold

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What could be improved

Expensive fees

Bitcoin IRA charges a set-up fee on your initial investment, as well as transaction fees of 2% per trade. These fees are common for crypto IRA accounts, but they're significantly higher than what you could pay on crypto exchanges. Exchanges normally don't have a set-up fee, and many of them charge transaction fees of 0.5% or less per trade.

SEE OUR TOP PICKS: Best Cryptocurrency Apps and Exchanges

Lack of fee transparency

Bitcoin IRA doesn't provide a breakdown of its fees upfront. Instead, it encourages you to call and talk to a representative. You can also email Bitcoin IRA or use its chat function and ask a representative there for its fees.

It's frustrating that Bitcoin IRA makes you jump through hoops to see how much it charges. Plenty of other crypto platforms provide detailed information on their fees online, so there's really no excuse not to provide this.

No crypto deposits

Because of IRS regulations, you can't transfer cryptocurrency into an IRA. You can only buy into your IRA with U.S. dollars, even if it's a crypto IRA. This regulation applies to any crypto-based retirement account, so it isn't limited to Bitcoin IRA.

How Bitcoin IRA works

Like its name suggests, Bitcoin IRA is a self-directed retirement account that lets you invest in cryptocurrency. It also offers gold.

The minimum investment for a new Bitcoin IRA account is $1,000. You can roll that over from your existing IRA, 401(k), or 403(b) funds, or you can make a cash contribution. However, you can't fund your account with cryptocurrency holdings because of IRS regulations. All deposits to Bitcoin IRA must be made in U.S. dollars.

If you roll over a retirement account, Bitcoin IRA will execute your rollover within three to five business days. Once your account is funded, you can begin trading on the platform. Funds remain inside your account within the platform, so you're not subject to capital gains or dividend taxes, and money you contribute to the account is tax deductible.

Because your holdings are in a retirement account, early withdrawal will subject you to tax penalties. You'll pay income tax and an early withdrawal fee (usually 10%) if you pull money out of the account before you're 59 ½. You can always sell your funds to reinvest in a different IRA.

LEARN MORE: How IRA Withdrawals Work

Fees overview

Exact fee amounts aren't available upfront with Bitcoin IRA. It states that it has an initial one-time service fee depending on your investment amount, as well as a minimal custodian and service fee. It encourages prospective clients to call a representative for more information.

When we reached out to Bitcoin IRA for a price quote, a representative provided the following fee list:

  • Set-up fee: 0.99%-2.99% charged on the initial deposit
  • Transaction fee: 2.00% on trades
  • Maintenance fee: 0.08% of total account's monthly value ($20 monthly minimum)

To get fee amounts, you can open an account with Bitcoin IRA through the "Open Account" option on this page. Alternatively, you can contact Bitcoin IRA via:

Cryptocurrency selection

Bitcoin IRA has a good selection of digital assets, especially for a cryptocurrency IRA. You can buy and sell over 60 cryptocurrencies on Bitcoin IRA, so there's a lot more to check out than just this company's namesake. Here are a few of the notable options in its crypto lineup:

Is your cryptocurrency safe with Bitcoin IRA?

Bitcoin IRA is a safe place to buy, sell, and store cryptocurrency. The platform takes security very seriously and has several layers of protections in place over client funds.

The Bitcoin IRA web app is secured with 256-bit encrypted SSL certification. Digital assets are stored with BitGo Trust, a service offered by Bitcoin IRA's custodian, BitGo. BitGo is the largest processor of on-chain Bitcoin transactions and holds over $2 billion in assets.

All cryptocurrency investments made with Bitcoin IRA are stored offline in cold storage. This type of crypto storage is the method of choice for maximum security, because it's not connected to the internet.

BitGo Trust also has insurance on custodial assets for up to $700 million. Insurance is provided by Lloyd's of London.

Bitcoin IRA is right for you if:

  • You'd like to diversify your retirement savings with Bitcoin and other cryptocurrencies.
  • You want to invest in cryptocurrencies tax free.
  • You can weather volatility in your retirement portfolio.