Ruling to Remember: 60-Day IRA Rollover Requirement
By The Slott Report Staff
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In this month’s Ruling to Remember, we take a look at Private Letter Ruling 201339002, submitted in late September 2012 as a waiver request to the 60-day IRA rollover requirement.
Taxpayer A, who we will call Joan, received a distribution from three separate IRAs then decided to shop around at different financial institutions for more favorable interest rates. She finally settled on a new bank, but was informed that her rollover contribution could NOT be accepted because it was past the 60-day IRA rollover window.
IRS rules that the information presented and the documentation presented by Joan indicated that she withdrew an IRA distribution with intent to redeposit the funds at a later time into another IRA that would yield a better rate of return. However, she did NOT demonstrate that her former bank had a duty to inform her of her 60-day IRA rollover requirement.
Her waiver was denied.
What You Should Learn:
A financial institution does NOT have an obligation to give advice (i.e. you better roll over the funds you are taking away from us to another financial institution within 60 days). If they are silent, they have no liability. They only have liability when they say things in error. YOYO, as Ed Slott says – you are own your own.