IRS written determination 201545034

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
REVENONS

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

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201545034

COMMISSIONER
TAX EXEMPT AND
GOVERNMENT ENTITIES
DIVISION
Uniform Issue List: 408.03-00

SE: T' EP. RA:JI

Legend:

Taxpayer A
\=

Plan B
\=

Company C
\=

Amount 1
\=
Amount 2
\=

Dear

This is in response to your request dated May 7, 2014, as supplemented by
correspondence dated September 15, 2014, and June 1, 2015, in which you
request a waiver of the 60-day rollover requirement under section 402(c)(3) of
the Internal Revenue 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 from Plan B totaling
Amount 1. Taxpayer asserts that her failure to complete a rollover of Amount 1
within the 60-day period prescribed by section 402(c)(3) of the Code was due to
her being unaware of her option to rollover Amount 1 and her need to use the
funds for repairs of her home.

In April 2013, Taxpayer A was separated from her employment with Company C.
On May 11, 2013, Taxpayer A received a Pension Plan Benefit Election Form
from Plan B. The form explained her benefit under Plan B and provided her the
option of receiving a benefit upon reaching normal retirement age or receiving a
lump-sum benefit. The lump-sum benefit must have been elected within 90-days

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of the May 11, 2013, letter. On May 23, 2013, Taxpayer A elected a lump sum
payment minus the required 20% mandatory withholding.

Taxpayer deposited Amount 2 into her checking account. Taxpayer asserts she
has not used Amount 2 for any other purpose. However, additional information
submitted by Taxpayer A on June 1, 2015, indicated that she needed the funds
for possible extensive repairs of her home.

Based on the facts and representations, you request a ruling that the Internal
Revenue Service (the "Service") waive the 60-day rollover requirement contained
in section 402(c)(3)(a) of the Code with respect to the distribution of Amount 1.

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)(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 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.

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 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,

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whether the check was cashed); and (4) the time elapsed since the distribution
occurred.

Taxpayer A has not presented any evidence to the Service as to how any of the
factors outlined in Rev. Proc. 2003-16 affected her ability to timely roll over the
distribution of Amount 2 into an IRA. In addition, Taxpayer A initially represented
that Amount 2 was not used for any other purposes, however, in her letter dated
June 1, 2015, Taxpayer A indicated she withheld the distribution for possible
repairs of her home.

Therefore, pursuant to section 402(d)(3) of the Code, Taxpayer A's request that
the Service waive the 60-day rollover requirement with respect to the distribution
of Amount 1 is declined and Amount 1 and any earnings thereon are therefore
includible in Taxpayer A's gross income for the 2013 taxable year.

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 have any questions, please contact

SE:T:EP:RA:T1.

Please address all correspondence to

Sincerely yours,
Colton Watkins

Carlton Watkins, Manager,
Employee Plans Technical Group 1

Enclosures:
Deleted Copy of Ruling Letter
Notice of Intention to Disclose