What type of investments does the IRS not allow?
The law does not permit IRA funds to be invested in life insurance or collectibles.
If you invest your IRA in collectibles, the amount invested is considered distributed in the year invested and you may have to pay a 10% additional tax on early distributions.
Here are some examples of collectibles:
- Metals – with exceptions for certain kinds of bullion
- Coins – (there are exceptions for certain coins)
- Alcoholic beverages
- Certain other tangible personal property