Editor’s note: The original December 2021 version of this article was lost. The Lee Daily Register rebuilt it in October 2026 from the Tax Court’s published opinion.
Keeping retirement-account gold in a safe at home can turn it into a taxable withdrawal. That is what the U.S. Tax Court decided on Nov. 18 in a case brought by a Rhode Island couple, Andrew and Donna McNulty.
The Internal Revenue Service had determined tax deficiencies of $250,558 for 2015 and $18,094 for 2016, plus accuracy-related penalties for both years, according to the court’s opinion by Judge Goeke in docket No. 1377-19. The court sided with the IRS.
How the coins ended up at home
In August 2015, Donna McNulty bought services from Check Book IRA LLC, whose website advertised that an IRA could own American Eagle coins through a limited liability company and that owners could keep the coins at home without tax consequences, the opinion says. She set up a self-directed IRA, moved money into it from an annuity and later a 401(k), and had the IRA buy membership units in an LLC she managed.
The LLC then bought 320 one-ounce gold American Eagle coins for $374,000 in 2015 and silver American Eagle coins for $37,380 in 2016. The coins were shipped to the couple’s home and kept in a safe. Andrew McNulty used his own IRA to invest in a condominium and coins through an LLC, and the couple later settled the tax treatment of his distributions, leaving only the penalties in dispute for his share.
What the court decided
An IRA must be held by a trustee or custodian acting as a fiduciary. Because Donna McNulty took physical possession of the coins, she received taxable distributions equal to their cost, $374,000 for 2015 and $37,380 for 2016, the court held. It rejected the argument that the coins belonged to the LLC rather than to her, finding no independent oversight of the assets.
The court also upheld the penalties. It found that the couple relied on a website’s marketing rather than professional advice, and that they did not tell the accountant who prepared their returns about the arrangement.
Why it matters to savers
Tax law lets IRAs hold certain gold and silver coins, and Check Book’s website marketed keeping them at home. The opinion makes clear that the custodian rules still apply to those coins.
What happened next
The decision was published as a full Tax Court opinion, 157 T.C. No. 10, and has since been cited in industry commentary on self-directed IRAs, including a December 2021 analysis in WealthManagement.com.
