Updated: August 13, 2026

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The word gold in gold IRA changes the metal in the vault. It does not change the tax code. Every distribution rule that applies to a traditional or Roth IRA at Fidelity or Vanguard applies to a self-directed IRA that holds American Eagles, bars, and rounds at a nonbank trustee.

This page is the roll up. Three questions decide almost every distribution: how old are you, do you want cash or metal, and is the money pre tax (traditional) or after tax (Roth). We map each one to the controlling IRC section, the Form 1099-R box 7 code, and the deeper OPRS guide when the mechanics run long.

Table of contents show

The age 59 and one half line and the 10 percent additional tax

Section 72(t)(1) of the Internal Revenue Code imposes an additional tax equal to 10 percent of the portion of an early distribution that is includible in gross income. Early means before age 59 and one half. The tax stacks on top of ordinary federal (and usually state) income tax on the same distribution.

A pre tax gold IRA funded by a 401(k) rollover is fully includible. The 10 percent applies to the entire fair market value of the metal distributed. A Roth gold IRA past the five year test is different (covered further down). The IRS description sits on the Retirement Topics page on the additional tax.

The additional tax is reported on Form 5329, Part I, filed with the annual Form 1040. The 1099-R issued by the custodian carries the distribution amount in box 1 and a distribution code in box 7. Under 59 and one half with no exception, that code is 1. With a known exception, the custodian may use code 2.

One practical note. The 10 percent additional tax is not the same as federal withholding on the distribution. Under Section 3405, the default withholding on an IRA payment to the account holder is 10 percent, waivable on Form W-4R. The custodian does not withhold for the Section 72(t) tax. The account holder settles that at filing on Form 5329.

Exceptions that avoid the 10 percent additional tax

Section 72(t)(2) lists carve outs that switch off the 10 percent. Ordinary income tax on the distribution still applies. Only the additional tax goes away. The full list sits in IRS Publication 590-B and in the Form 5329 instructions.

Exception	IRC section	Form 5329 code
Death of the account holder	72(t)(2)(A)(ii)	04
Total and permanent disability	72(t)(2)(A)(iii)	03
Substantially equal periodic payments (SEPP)	72(t)(2)(A)(iv)	02
Unreimbursed medical expenses over 7.5% of AGI	72(t)(2)(B)	05
Health insurance premiums while unemployed	72(t)(2)(D)	07
Qualified higher education expenses	72(t)(2)(E)	08
First time home purchase (10000 lifetime cap)	72(t)(2)(F)	09
IRS levy on the account	72(t)(2)(A)(vii)	10
Federally declared disaster (5000 cap)	72(t)(2)(M)	12
Terminal illness	72(t)(2)(L)	21
Public safety officer separation at 50 or 25 years of service	72(t)(10)(B)	01

Two of the exceptions carry the most weight for readers pulling from a gold IRA before 59 and one half. Both deserve a full guide of their own.

72(t) SEPP: the substantially equal periodic payment path

The Section 72(t)(2)(A)(iv) carve out lets an account holder of any age unlock the account by committing to a schedule of substantially equal annual payments. The schedule must last at least five years or until age 59 and one half, whichever is longer. Modification before then triggers recapture of every previously waived 10 percent plus interest.

Three IRS approved calculation methods exist: required minimum distribution, fixed amortization, and fixed annuitization. Notice 2022-6 updated the interest rate and mortality tables. SEPP is a fit for early retirees who want an income stream and are ready to accept the multi year commitment. The full mechanics sit in the deep dive on gold IRA early withdrawal and the 72(t) SEPP procedure.

Public safety officer age 50 exception

Section 72(t)(10) waives the 10 percent additional tax for a qualified public safety officer who separates from service in or after the year age 50 is reached (or after 25 years of service, if earlier). The rule applies to distributions from a governmental defined benefit or defined contribution plan and, since SECURE 2.0, from a private sector defined benefit plan for firefighters.

The carve out only applies while the funds sit in the plan. A rollover to a self-directed IRA generally closes the door on the exception for anything taken from the IRA. That timing choice is a big planning decision for retiring police, firefighters, air traffic controllers, and paramedics. Details sit in the guide on the public safety officer age 50 exception and a gold IRA.

Required minimum distributions at age 73

SECURE 2.0 pushed the required beginning date for most account holders to April 1 of the year after age 73 is reached. Each year after that, a required minimum distribution (RMD) must come out by December 31. The 25 percent excise tax on a missed RMD (Section 4974) was cut to 25 percent, and to 10 percent if corrected within a two year window.

The RMD is computed on the December 31 prior year balance divided by a life expectancy factor from the IRS uniform lifetime table (or joint table if a spouse more than 10 years younger is the sole beneficiary). A gold IRA custodian reports the prior year value using the fair market value of the metal on that date. See the 2026 RMD tables applied to a gold IRA for the full walk through.

The RMD amount can be taken in cash or in kind. In kind means the custodian ships coins or bars with a fair market value equal to the RMD requirement on the distribution date. Basis and storage math change based on which pathway is chosen. The trade offs sit in the guide on in kind gold RMD versus cash RMD.

The two distribution forms: cash after liquidation, or in kind metal

Every gold IRA distribution takes one of two shapes.

Cash after liquidation. The custodian instructs the depository to sell the metal, usually back to the original dealer or through a competitive bid. Cash lands in the IRA and is then wired or mailed to the account holder. Ordinary income tax applies on the full amount for a traditional gold IRA. The 1099-R shows the cash figure.

The spread between the buy back bid and the ask on the day of sale is a real cost. Reader review of the fair market value benchmark on the distribution date is the discipline that keeps the custodian and dealer honest. The math sits in the guide on gold IRA liquidation price math.

In kind metal shipment. The custodian ships the actual coins or bars from the depository to the account holder (or to a new non IRA vault). The distribution amount reported on the 1099-R is the fair market value of the metal on the shipment date. That figure becomes the account holder’s basis in the metal for any later personal sale.

In kind is a fit when the account holder wants to keep the physical metal, treats the distribution date value as the entry price for future capital gains treatment, and can accept the ordinary income tax hit up front. It is a common choice for RMDs at 73 for readers who dislike the buy back spread.

Tax reporting on Form 1099-R

Every gold IRA distribution generates a Form 1099-R from the custodian in January of the following year. The document has three fields that decide most of the tax outcome.

Box 1 (gross distribution): total amount of the distribution.
Box 2a (taxable amount): portion the custodian believes is taxable. For a traditional IRA that has never held after tax contributions, box 2a usually equals box 1.
Box 7 (distribution code): signals the IRS how to treat the distribution. Codes matter.

Common box 7 codes: 1 early distribution no known exception, 2 early distribution exception applies, 4 death, 7 normal distribution (over 59 and one half), G direct rollover, B Roth distribution. A wrong code is the number one reason a taxpayer receives an IRS CP2000 notice claiming an unpaid 10 percent additional tax. The mapping sits in the guide on Form 1099-R distribution codes for a gold IRA.

Roth gold IRA: what changes

A Roth gold IRA follows the same age 59 and one half framework but adds a second clock: the five year rule. Once both are cleared, qualified distributions are federal income tax free and the 10 percent additional tax does not apply.

Before both clocks tick, Publication 590-B ordering rules apply: contributions come out first (tax and penalty free at any time), then conversions, then earnings. The full mechanics sit in the guide on the Roth gold IRA explained.

A Roth account holder never faces RMDs during life (the SECURE 2.0 Section 325 change removed Roth RMDs from workplace plans as well, effective 2024). A traditional gold IRA account holder does. That single asymmetry is often the deciding factor between the two structures. Compare the two side by side on the Roth versus traditional gold IRA page.

State tax on gold IRA distributions

The federal treatment is only half the bill. State income tax on the distribution can range from zero to over 10 percent, depending on the state of residence at the time the money is received. State residency is the trigger, not where the depository holds the metal.

Three examples give the range. Florida has no state income tax on retirement distributions. Ohio taxes the distribution as ordinary income at the usual brackets but grants a retirement income credit under Ohio Revised Code 5747.055. California taxes the full distribution at ordinary rates and does not conform to several federal early distribution exceptions.

Moving state before a large distribution can be a lever. The IRS rule is straightforward: the distribution belongs to the state where the account holder is domiciled on the date of receipt. Check the OPRS state series on gold IRA taxes for the state that applies to your situation. Some states also assess an additional early distribution tax on top of the federal 10 percent.

Closing the account entirely

A full account closure is a lump sum distribution of everything left in the gold IRA. All the rules above still apply, only bigger. The single check to send the whole balance in one tax year can push the account holder into the top ordinary bracket. It may also trigger the Section 1411 net investment income tax on other income through AGI stacking.

Three common alternatives to a same year full closure. A two or three tax year draw down that spreads the taxable amount across brackets. A rollover of the residual to a traditional IRA at a mainstream custodian if fees are the reason for the exit. A partial in kind distribution followed by a cash close. Each pathway comes with its own custodian paperwork. The full playbook sits in how to close a gold IRA account.

Distribution rules recap

The gold IRA distribution map, condensed to one screen:

Under 59 and one half: ordinary income tax plus 10 percent additional tax, unless a Section 72(t)(2) exception, a 72(t) SEPP schedule, or the Section 72(t)(10) public safety officer carve out applies.
59 and one half to 72: ordinary income tax on the distribution amount, no additional tax. Distribution timing is flexible.
73 and older: mandatory RMDs each year (traditional only; Roth exempt during life), computed on prior year December 31 fair market value divided by the uniform lifetime factor.
Cash pathway: metal sold at the depository, proceeds paid to the account holder, ordinary income tax on the cash.
In kind pathway: metal shipped to the account holder, ordinary income tax on the fair market value on the shipment date, that value becomes basis for a future personal sale.
Roth: same 59 and one half line plus a five year rule; ordering rules per Publication 590-B; no lifetime RMDs.
Reporting: Form 1099-R from the custodian, Form 5329 Part I to claim any exception, Form 1040 line for the taxable amount.

Every deep dive linked above stays in sync with current IRS guidance and gets a fresh review whenever the code or the rulings change. This roll up page was last reviewed on August 13, 2026.

Gold IRA Withdrawal Rules: Age 59.5, RMDs at 73, Cash vs In-Kind, Roth Differences