IRS written determination 201524030

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
MAR 18 2015
Uniform Issue List: 402.00-00
Legend:
Taxpayer A
=
Company 8
=
Plan C
=
Financial Institution D
=
Company E
=
Amount 1
=
Amount 2
=
Amount 3
=
Dear
!01524030
This is in response to a request for a private letter ruling dated October 16, 2014,
as supplemented by correspondences dated December
11, 2014, and January
21, and February 20, 2015,
in which you request a waiver of the 60-day rollover
requirement contained
in section 402(c)(3) of the Internal Revenue Code
("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 1 from Plan
C.
Taxpayer A asserts that her failure to accomplish a rollover within the 60-day
period prescribed by section 402(c)(3)
of the Code was due to her failure to

2
2D1524oao
receive notification that Plan C was terminating and subsequent failure to receive
the distribution check issued by Financial Institution
D.
Taxpayer A worked for Company Band participated in Plan C, a qualified plan
under section
401 (a) of the Code. Plan C was maintained with Financial
Institution
D. In mid-2013 Company B was sold to Company E which became
Taxpayer A's new employer. Coinciding with this transaction, Plan
C was
terminated. On August
2, 2013, Financial Institution D, the administrator of
Plan C, sent notice of the plan termination. Taxpayer A represents she never
received the notice nor the subsequent distribution check issued on September
6, 2013, by Financial Institution D. The check was for Amount 2, representing
Taxpayer's A account balance in Plan
C (Amount 1) less federal taxes withheld
(Amount 3).
Taxpayer A first noticed the distribution from Plan
Con January 22, 2014, when
she began preparing her 2013 tax return. She went on-line to view her account
balance
in Plan C plan and noticed it was zero. She immediately contacted
Financial
Institution D who was unable to find a copy
of the distribution check or
the letter informing Taxpayer A of the plan termination. Between January and
September, 2014, Taxpayer spoke to Financial Institution D a total
of 16 times,
attempting to accomplish a rollover
of the distributed funds. On March 13, 2014,
Financial Institution D re-issued the check for Amount
2. Taxpayer A returned it
to Financial
Institution D with a request that it be deposited (rolled over) to an
IRA. Financial Institution D refused to do this. They held the
check for
180 days
then cancelled
it. On September 19, 2014, Financial Institution D re-issued the
check for Amount 2 which remains uncashed
in the possession of Taxpayer A.
Based on the facts and representations, you request a ruling that the Internal
Revenue Service waive the 60 day rollover requirement
in section 402(c)(3) of
the Code with respect to the distribution of Amount 2.
Section 402(c) of the Code provides that if any portion of the balance to the credit
of an employee in a qualified trust is paid to the employee in an eligible rollover
distribution, and the distributee transfers any portion
of the property received in
such distribution to an eligible retirement plan, and
in the case of a distribution of
property other than money, the amount so transferred consists of the property
distributed, then such distribution (to the extent transferred) shall not be
includible in gross income for the taxable year in which paid. Section
402(c)(3)(A) states that such rollover must be accomplished within
60 days
following the day
on which the distributee received the property. An individual
retirement account (IRA) constitutes one form
of eligible retirement plan.
Section 402(c)(4)
of the Code provides that an eligible rollover distribution shall
not include any distribution to the extent such distribution is required under
section
401 (a)(9).

3
201524030
Section 402(c)(3)(B) of the Code provides, in relevant part, that the Secretary
may waive the 60-day requirement under sections 402(c) 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 402(c)(3)(B)
of the Code.
Section 402(f)
of the Code generally provides that administrators of qualified
plans are required to provide plan participants a written explanation
of their right
to roll over distributions to another eligible retirement plan.
Section
401 (a)(31) provides the rules for governing "direct transfers of eligible
rollover distributions".
Section 1.401(a)(31)-1
of the Income Tax Regulations, Question and Answer-15,
provides,
in relevant part, that an eligible rollover distribution that is paid to an
eligible retirement plan in a direct rollover
is a distribution and rollover, and not a
transfer
of assets and liabilities.
Revenue Procedure 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 402(c)(3)
of the Code, 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 the documentation submitted by Taxpayer A is
consistent with her assertion that her failure to accomplish a timely rollover
of
Amount 1 was due to her failure to receive notification that Plan C was
terminating and subsequent failure to receive the distribution check issued by
Financial Institution D.
Therefore, pursuant to section 402(c)(3)(B) of the Code, the Service hereby
waives the 60-day rollover requirement with respect to the distribution
of
Amount 1. Taxpayer A is granted a period of 60 days from the issuance of this
letter ruling to contribute no more than Amount 1 into a rollover IRA or other
eligible retirement plan. Provided all other requirements
of section 402(c) 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 402(c) of the Code.
This ruling does not authorize the rollover
of amounts that are required to be
distributed by section 401 (a)(9) of the Code.

•
4
20152.4030
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 ( )
Sincerely yours,
G-ll:;;:__ A-t~J~tr~
Manager
Employee Plans Technical Group 1
Enclosures:
Deleted Copy
of this Letter
Notice
of Intention to Disclose, Notice 437
cc: