IRS written determination 201438035

Private letter rulings and published taxpayer determination letters. Native document type is retained separately; a determination letter is not labeled a private letter ruling. These taxpayer-specific releases cannot be used or cited as precedent under 26 USC 6110(k)(3); applicability and current legal force are not independently certified. Keep repeated UILC subjects attached to one actual numbered document.

TAX EXEMPT AND
GOVERNMENT ENTITIES
DIVISION
DEPARTMENT OF THE TREASURY
INTERNAL REVENUE SERVICE
WASHINGTON, D.C. 20224
JUN 2 7 2014
Uniform Issue List: 408.03-00
Legend:
Taxpayer:
IRA:
Amount:
Vendor:
Financial Institution:
Agent:
Dear
2«11438035
This is in response to your letter dated July 25, 2013, submitted on your
behalf by your authorized representative, as supplemented by correspondence
received on November
2, 2013, May 1, 2014, and May 12,2014, 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 represents that he received a distribution from
IRA totaling
Amount. Taxpayer asserts that his failure to accomplish a rollover within the 60-
day period prescribed by section 408(d)(3) was due to an error committed by
Agent when submitting an online application to Financial Institution, which led to
Amount being placed
in a Certificate of Deposit, a non-qualified account with

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281438035
Financial Institution. Taxpayer further represents that Amount has not been used
for any other purpose.
Taxpayer represents that
he withdrew Amount from IRA, on March 14,
2012, with the intent to rollover funds from IRA to a rollover IRA, maintained by
Financial Institution
in order to obtain a higher rate of return. On March 20, 2012,
Taxpayer visited a branch
of Vendor, an agent for Financial Institution. Taxpayer
consulted with Agent and requested to establish a rollover IRA
CD at Financial
Institution to receive Amount from IRA. Agent mistakenly opened a non-IRA
account using Financial Institution online account opening application.
On March 23, 2012, Taxpayer mailed Amount to Financial Institution for
rollover contribution to the rollover IRA, which
he believed he had established.
----.=inancn:n
lnstitution-rece1vea~Amount on Marcn~28.~0'12, anaaeposifeaAmount
into the non-IRA account, erroneously opened by Agent. Subsequently,
Financial Institution issued Taxpayer
an email confirming the opening of a CD.
Taxpayer received no further correspondence or communication from
Agent, Vendor, or Financial Institution regarding the non-IRA account.
In January
2013, Taxpayer discovered the error when he received a Form 1 099-INT issued
by Financial Institution reporting taxable interest income generated by the non-
IRA account.
You submitted correspondence dated March 25, 2013, from Financial
Institution, and March
12, 2013, from Vendor, which indicate erroneous
instructions from Agent to Vendor, including establishing
an Non-IRA CD instead
of a rollover IRA
CD, resulting in the failure of the intended rollover by Taxpayer.
Based
on the faCts and representations, you request a ruling that the
Internal Revenue Service ("Service") waive the 60-day rollover requirement
contained
in section408(d)(3) ofthe Code with respect to the distribution of
Amount. '
Section 408(d)(1)
of the Code provides that, except as otherwise provided
in section 408(d), 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:
· .
.
,

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2&1438035
(i) the entire amount received (including money and any other property) is
paid into an
IRA for the benefit
of such individual not later than the 60th day after
the day on which the individual receives the payment
or distribution; or
(ii) the entire amount received (including money and any other property) is
paid into an eligible retirement plan (other than
an IRA) for the benefit of such
individual not later than the
60th day after the date on which the payment or
distribution is received, except that the maximum amount which may be paid into
such
plan may not exceed the portion
of the amount received which is includible
in gross income (determined without regard to section 408(d)(3)).
Section 408(d)(3)(8)
of the Code provides that section 408(d)(3) does not
apptyto~amount described in section 408fd){3)\AJ(iJreceWed try anTnrnvialial ·
from an IRA if at any time during the 1-year period ending on the day of such
receipt such individual received any other amount described
in section
408(d)(3)(A)(i) from
an IRA which was not includible in gross income because of
the application of section 408(d)(3).
Section 408(d)(3)(D)
of the Code provides a similar 60-day rollover period
for partial relievers.
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)(1)
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.
Rev. Proc.
2003-16, 2003-4 I.R.S. 359 (January 27, 2003) provides that
in
determining whether to grant a waiver of the 60-day rollover requirement
pursuant to section
408(d)(3)(1), 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 is
consistent with his assertion that the
failure to accomplish a rollover
of Amount

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201438035
within the 60-day period prescribed by section 408(d)(3) of the Code was due to
errors committed by Agent and
Financial Institution.
Therefore, pursuant to section 408(d)(3)(1)
of the Code, the Service
hereby waives the 60-day rollover requirement with respect to the distribution of
Amount from IRA. Taxpayer is granted a period of 60 days from the date of the
issuance of this letter ruling to make a rollover contribution of Amount to 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 will be considered a rollover contribution within the meaning
of
section 408(d)(3) of the Code.
This ruling does not authorize the rollover
of amounts that are required to
iJe dts1ribated-tlys-ec1ton 401 (a)(9)oflheCode. · ~~ -~-··-~··---
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
611 O(k)(3) of the Code provides that it may not be used or cited as precedent.
If you have any questions, please contact
correspondence to SE:T:EP:RA:T2.
Enclosures:
CC:
Deleted
Copy
of Ruling Letter
Notice
of Intention to Disclose
Please address all