IRS written determination 201437023

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 1 8 Z014
Uniform Issue List: 408.07-00
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Company
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Dear**************:
201437023
This letter is in response to your request for a ruling which was submitted by your
authorized representative on May 20, 2011.
Company is a financial services company that
is a passive and active non-bank trustee
and custodian
of Individual Retirement Accounts (IRAs) and Coverdell Education
Savings Accounts (CESAs).
In order for an individual to make a contribution to an existing IRA or CESA from a non-
retirement account held at Company, the individual must submit a letter
of authorization
(LOA), which is either a written letter from the client or his or her authorized
representative, or a verbal request by the client or authorized representative to a
Company representative which
is summarized via a written document signed and dated
by Company. The LOA indicates the amount
of cash contribution to the IRA, the non-
retirement account from which the funds are to be transferred, and the tax year that the
contribution is designated for,
or if silent, the contribution is treated as designated for
the current year.
The
LOA is irrevocable on receipt, and Company processes such LOAs as soon as
administratively practicable, subject to the client having sufficient funds in his
or her
account and having already established either an
IRA or CESA with Company.
Company then transfers funds from the individual's brokerage or other account to the
individual's IRA or CESA.
In some cases, due to processing times, even if the LOA is
received by the April
15th deadline, the transfer may not be processed until after such
date. ·

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201437023
Accordingly, you have asked us to rule that an individual who submits a LOA directing
Company to transfer funds from a non-retirement account to a IRA or CESA,
postmarked or transmitted not later than the time prescribed by law for filing the
individual's tax return for such taxable year, shall be deemed to have made a cash
contribution to an IRA or CESA
on the last day of the preceding taxable year under
sections 219(f)(3), 408(a)(1
), 408A(c)(7), 530(b)(1 )(A), and 530(b)(4) of the Code (as
applicable), provided the funds are,
in fact, transferred in a reasonable time.
Section 219(f)(3) of the Code states that a taxpayer shall be deemed to have made a
contribution to an individual retirement plan
on the last day of the preceding taxable
year if the contribution is made
on account of such taxable year and is made not later
than the time prescribed by law for filing the return for such taxable year (not including
extensions thereof)
Section
408(a)(1) of the Code generally provides that
no contribution to an IRA will be
accepted unless it
is in cash, and not in excess of the amount in effect for such taxable
year under section 219(b)(1)(A).
Section 530(b)(1 )(A) of the Code states that no contribution to a CESA will be accepted
unless it is
in cash, made before the date on which the beneficiary attains age 18, and
not
in excess of $2,000 in aggregate for the year, not counting rollover contributions.
Section 530(b)(4) of the Code states that a taxpayer shall be deemed to have made a
contribution to a CESA on the last day of the preceding taxable year if the contribution
is
made on account of such taxable year and is made not later than the time prescribed by
law for filing the return for such taxable year (not including extensions thereof).
Section 7502(a)(1) of the Code provides that where a payment
is required to be made
within a period prescribed by any provision of the internal revenue laws, the date of the
United States postmark stamped
on the cover in which such payment is mailed shall be
deemed the date of payment.
We conclude with respect to your ruling request that an individual who submits an LOA
to Company directing it to transfer funds from a non-retirement Company account to
an
IRA or CESA if, when received, the date of the U.S. postmark stamped on the cover in
which such payment is mailed (or if a verbal request, the date upon which the request is
made to a Company representative) is not later than the due date of the taxpayer's
return (not
including extensions thereof), such individual shall be deemed to have made
a cash contribution to such
IRA or CESA
on the last day of the preceding taxable year
under sections 219(f)(3), 408(a)(1), 408A(c)(7), 530(b)(1)(A), and 530(b)(A) of the Code
(as
applicable), provided the funds are,
in fact, transferred as soon a administratively
practicable.
This ruling assumes that the IRAs
in question satisfy the requirements of section 408
and the CESAs
in question satisfy the requirements of section 530 of the Code.

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201437023
This ruling is directed only to the taxpayer that requested it. Section 611 O(k)(3) of the
Code provides that it may not be used or cited by others as precedent.
Pursuant to a power of attorney on file with this office, a copy of this ruling
is being sent
to your authorized representative.
If you require further assistance in this matter, please contact************* at(****) ****-
******
Please address
all correspondence to SE:T:EP:RA:T2.
Enclosures:
Deleted
copy
of ruling letter
Notice
of Intention to Disclose
cc: ***********************
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