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5500 Preparer's Manual for 2012 Plan Years

5500 Preparer's Manual for 2012 Plan Years
The premier resource in the field of Form 5500 preparation, 5500 Preparer's Manual will help you handle the required annual Form 5500 filings for both pension benefits and welfare benefit plans.

CCH® PENSION — 10/25/10

Waiver of 60-day rollover requirement denied due to lack of written document showing intention of transferring funds to IRA

A taxpayer who claimed that his failure to complete a rollover to an individual retirement account (IRA) or another eligible retirement plan within 60 days was due to a financial institution error was denied a waiver from the 60-day rollover requirement, according to IRS Letter Ruling 201034025. The taxpayer was unable to provide a written document establishing that he had wanted to transfer funds to an IRA nor was he able to provide any written statement from the financial institution that it had erred in the placement of the individual's assets into a nonqualified account.

The IRS noted that the financial institution's application form completed by the taxpayer failed to demonstrate that the taxpayer intended to roll over the funds to an IRA nor does the form show that the financial institution committed any error. In addition, the taxpayer failed to to establish that the financial institution was notified of his intention to rollover the funds. Therefore, the taxpayer's deposit of funds received from one financial institution's IRA into another financial institution's high interest checking account and subsequent investments in nonqualified investment vehicles with the second financial institution was a taxable event under Code Sec. 408(d)(1). The IRS declined to waive the 60-day rollover requirement.

For more information on this and related topics, consult the CCH Pension Plan Guide, CCH Employee Benefits Management, and Spencer's Benefits Reports.

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