So, you’ve decided to invest some of your retirement savings in opening up a Bitcoin IRA account. Your next step should be to look for experience Bitcoin IRA custodians, who can manage your Bitcoin IRA account on your behalf. If you’re interested in learning about the role of an IRA custodian, continue reading to discover everything you need to know about the role of a Bitcoin IRA custodian!
Everything you need to know about Bitcoin IRA custodians:
Why do investors require a Bitcoin IRA custodian?
One of the key reasons why investors are required to hire a custodian for their IRA Bitcoin account is to ensure that investors accurately report all of their transactions to the IRS.
The IRS are highly interested in IRA accounts as the IRS offers investors tax breaks in order to purchase assets such as Bitcoin and want to ensure that their investment isn’t being abused and that investors are following the rules set for IRA accounts. By hiring a Bitcoin custodian, you’ll be confident that your account complies with IRS regulations.
What tasks can an IRA custodian perform on your behalf?
If you decide to withdraw a portion of your IRA funds before you reach retirement age, you can ask your IRA custodian to help you make a withdrawal from your Bitcoin IRA account. As unless you’ve chosen to store your Bitcoin investments in a Roth IRA account, you won’t be able to withdraw funds from your IRA account, without a registered custodian. Just be mindful that if you choose to invest funds in an IRA account, you may be penalized with a substantial fee, if you choose to withdraw your funds before you reach retirement age. Although, if you’re lucky you may be able to apply for a one-off exemption to withdraw funds from your IRA account if you’re looking to purchase a house or enroll in college.
If you’d like to invest further Bitcoin shares, you can also contact your IRA custodian so that they can purchase further Bitcoin shares during a live trade. If you want to listen to your live trade taking place, you can arrange for your live trade to take place during a phone call. If you choose to sell some of your Bitcoin shares, your IRA custodian can also help you find willing buyers.
Lastly, an IRA custodian is responsible for ensuring that your Bitcoins are kept safe for you. One of your chosen IRA custodians primary tasks is to make sure that the bitcoin wallet which your Bitcoins are kept in is protected by a wide variety of preventive safety measures. As one of the few downsides of Bitcoins is that as Bitcoins are anonymous in nature if your Bitcoins are stolen, there is no way to trace your Bitcoins or to get your Bitcoins back.
If you’ve decided to invest in IRA Bitcoin, it pays to choose your IRA custodian carefully as the security of your investment is dependent on the IRA custodian who you choose to manage your IRA account.