IRA Distribution Rollover Requirement Waived

Uniform Issue List: 408.03-00

This is in response to a request for a letter ruling dated May 25, 2014, and supplemented by correspondence dated February 13, 2015, from your authorized representative, in which you request a waiver of the 60-day rollover requirement contained in section 408(d)(3) of the Internal Revenue Code (the "Code").

The following facts and representations have been submitted under penalty of perjury in support of the ruling requested.

Taxpayer A represents that he received a distribution totaling Amount 1 from IRA B maintained by Bank C. Taxpayer A asserts that his failure to accomplish a rollover within the 60-day period prescribed by section 408(d)(3) was due to a miscommunication with a representative of Bank D which led to Amount 1 being placed in non-IRA Account E. Taxpayer A further represents that Amount 1 has not been used for any other purpose.

Taxpayer A represents that he owned IRA B which was a CD maintained with Bank C. The CD in IRA B was set to mature in October, 20* * *. On October 11, 20* * *, Taxpayer A went to Bank C and received a total distribution of Amount 1. Seeking a higher rate of return, Taxpayer A intended to rollover Amount 2, a portion of Amount 1, at Bank D. On October 15, 20* * *, Taxpayer A represents he met with a representative and was presented with information regarding setting up an IRA at Bank D to receive the rollover funds. Taxpayer A selected a long term income fund and thought he had completed the rollover to an IRA at Bank D. However, in 20* * * while his income taxes were being prepared it was discovered that the account was a non-IRA account. The request for relief is accompanied by the "IRA Managed Proposal" that was presented to Taxpayer A by the representative of Bank D.

Based on the facts and representations, you request a ruling that the Internal Revenue Service waive the 60-day rollover requirement contained in section 408(d)(3) of the Code with respect to the distribution of Amount 2 from IRA B.

Section 408(d)(1) of the Code provides that, except as otherwise provided in section 408(d) of the Code, any amount paid or distributed out of an IRA shall be included in gross income by the payee or distributee, as the case may be, in the manner provided under section 72 of the Code.

Section 408(d)(3) of the Code defines, and provides the rules applicable to IRA rollovers.

Section 408(d)(3)(A) of the Code provides that section 408(d)(1) of the Code does not apply to any amount paid or distributed out of an IRA to the individual for whose benefit the IRA is maintained if --

Section 408(d)(3)(D) of the Code provides a similar 60-day rollover period for partial rollovers.

Section 408(d)(3)(E) of the Code provides that the rollover provisions of section 408(d) do not apply to any amount required to be distributed under section 408(a)(6).

Section 408(d)(3)(I) of the Code provides that the Secretary may waive the 60-day requirement under sections 408(d)(3)(A) and 408(d)(3)(D) of the Code where the failure to waive such requirement would be against equity or good conscience, including casualty, disaster, or other events beyond the reasonable control of the individual subject to such requirement. Only distributions that occurred after December 31, 2001, are eligible for the waiver under section 408(d)(3)(I) of the Code.

Rev. Proc. 2003-16, 2003-4 I.R.B. 359 (January 27, 2003) provides that in determining whether to grant a waiver of the 60-day rollover requirement pursuant to sections 408(d)(3)(I), the Service will consider all relevant facts and circumstances, including: (1) errors committed by a financial institution; (2) inability to complete a rollover due to death, disability, hospitalization, incarceration, restrictions imposed by a foreign country or postal error; (3) the use of the amount distributed (for example, in the case of payment by check, whether the check was cashed); and (4) the time elapsed since the distribution occurred.

The information presented and documentation submitted by Taxpayer A are consistent with his assertion that his failure to accomplish a timely rollover of Amount 2 was caused by a miscommunication with a representative of Bank D which led to Amount 2 to be deposited into a non-IRA account. Therefore, Taxpayer A is granted a period of 60 days from the issuance of this ruling letter to contribute Amount 2 into a Rollover IRA. Provided all other requirements of section 408(d)(3) of the Code, except the 60-day requirement, are met with respect to such contribution, the contribution of Amount 2 will be considered a rollover contribution within the meaning of section 408(d)(3).

This ruling does not authorize the rollover of amounts that are required to be distributed by section 401(a)(9) of the Code.

No opinion is expressed as to the tax treatment of the transaction described herein under the provisions of any other section of either the Code or regulations which may be applicable thereto.

This letter is directed only to the taxpayer who requested it. Section 6110(k)(3) of the Code provides that it may not be used or cited as precedent.

If you wish to inquire about this ruling, please contact * * * (I.D. # * * *) at * * * Please address all correspondence to SE:T:EP:RA:T1.