IRS written determination 201439004

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.

TREASURY
RNAL REVENUE SER
SERVIC

TAX EXEMPT AND
GOVERNMENT ENTITIES
DIVISION

DEPARTMENT OF THE TREASURY
INTERNAL REVENUE SERVICE
WASHINGTON, D.C. 20224

JUN 3 0 2014

201439004

Uniform Issue List: 408.03-00

T. EP. RA. TI

Legend:

Taxpayer A
\=

IRA B
\=

Financial Institution C
\=

Account D
\=

Account E
\=

Financial Institution F
\=

Amount 1
\=

Amount 2

=

Amount 3
\=

Amount 4
\=

Amount 5
\=
Amount 6
\=

Dear
:

This is in response to your request for a ruling dated August 1, 2013, as
supplemented by correspondence dated September 17, and November 15, 2013,

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and February 18, and April 28, 2014, 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 she received a distribution of Amount 4 from
IRA B with the intention of using Amount 1 to invest within a newly opened IRA.
Taxpayer A asserts that her failure to accomplish a rollover of Amount 1 within
the 60-day period prescribed by section 408(d)(3) of the Code occurred when
Financial Institution F failed to follow her rollover instructions.

Taxpayer A maintained IRA B, under section 408(a) of the Code, with Financial
Institution C. On January 30, 2012, Taxpayer A requested a distribution of
Amount 4 from IRA B, of which Amount 5 was a required minimum distribution for
2012. On the same day, Taxpayer A met with a customer service representative
from Financial Institution F. During the meeting, Taxpayer A expressed a desire
to roll over Amount 1 and have it (Amount 4 less Amount 5) invested in the same
manner as it was with Financial Institution C. In March of 2013, during the
preparation of Taxpayer A's tax return, it was discovered that Amount 2 had been
deposited into Account D, a non-IRA Certificate of Deposit account, and Amount
3 had been deposited into Account E, also a non-IRA Account. The apparent
reason for the split deposit was Taxpayer A's desire to make 2012 gifts to family
members. Following the deposit of Amount 3 into Account E, Taxpayer A
withdrew Amount 6 in order to make these gifts. Taxpayer A represents that
Amount 2 has not been used for any other purpose.

Based on the facts and representations, you request a ruling that the Service
waive the 60-day rollover requirement contained in section 408(d)(3) of the Code
with respect to the distribution of Amount 1 from IRA B.

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 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 -

(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

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(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)(B) of the Code provides that section 408(d)(3) does not
apply to any amount described in section 408(d)(3)(A)(i) received by an individual
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 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)(l) 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 section 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.

Taxpayer A asserts that Financial Institution F did not follow her instructions to
roll over Amount 1 into an IRA. Instead, Amount 1 was split into Amount 2 and
Amount 3. Amount 2 was deposited into Account D. Amount 3 was initially
deposited into Account E, but then spent by Taxpayer A for personal reasons.

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After considering all relevant facts and circumstances concerning Taxpayer A's
assertion that Institution F did not follow her instructions, we hereby waive the
60-day rollover requirement with respect to the distribution of Amount 2 from
IRA B. Taxpayer A is granted a period of 60 days from the issuance of this letter
ruling to transfer an amount not to exceed 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, Amount 2 will be
considered a rollover contribution within the meaning of section 408(d)(3) of the
Code.

However, with respect to Amount 3, the facts and circumstances show that
Taxpayer A used Amount 3 to make gifts to family members. Therefore, the
Service declines to waive the 60-day rollover requirement with respect to the
distribution of Amount 3 from IRA B.

This ruling does not authorize the rollover of amounts that are required to be
distributed by section 408(a)(6) 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.

A copy of this letter ruling has been sent to your authorized representative
pursuant to a power of attorney on file in this office. If you wish to inquire about
this ruling, please contact
(I.D. #
), SE:T:EP:RA:T1, at ( )

Sincerely yours,
Calta A. Watkins
Manager
Employee Plans Technical Group 1

Enclosures:
Deleted Copy of this Letter
Notice of Intention to Disclose, Notice 437

CC: