department of the treasury internal_revenue_service washington d c sep 3q ae on ’ e tax_exempt_and_government_entities_division u i l kekerekeerkreeeeerrerereere keekeeekkrerererreerrreeee kkrerererrrereerrerrerer krerekrererrereerereerrerer legend taxpayer a rrr r ka kaerkkkrrekrererere ira x ahir ra kerr re rrr rr kerrier individual m iii er iri trust t amount d er keke iaea rr rie e rie iie ree custodian b erik rk eere ree rir me friar beneficiary e me err kk arerr rarer rrr rr iie beneficiary f me rii iir rrr rie retr i i beneficiary g beneficiary h beneficiary k me rei i erie rarer eere rkekkkererereerreerereere krekkekrkerereerrerererer dear kekerkeeekerrerer this is in response to your letter dated date as supplemented by correspondence dated date date and date submitted on your behalf by your authorized representative in which you request a ruling to waive the 60-day rollover requirement contained in sec_408 of the internal_revenue_code the code’ khkkekekrekekekrerererrkererrk the following facts and representations have been submitted under penalties of perjury in support of the ruling requested individual m established trust t and appointed individual m established an individual_retirement_arrangement ira x with custodian b on june taxpayer a as a trustee of trust t trust t was named the primary beneficiary of ira x article ill of the trust t agreement identifies beneficiaries e f g h and k as equal beneficiaries of trust t each beneficiary's share is to be held as a separate trust and administered according to the terms of trust t however with respect to the ira x assets trust t provides that none of the ira x assets is to be deposited into beneficiary e’s individual m’s surviving_spouse separate trust therefore taxpayer a states that under the provisions of trust t the four individuals entitled receive an equal share of ira x are beneficiaries f g h and k individual m died on february of individual m’s estate taxpayer a is also the executor taxpayer a contacted custodian b in order to determine on december if there were any matters that needed to be wound up with respect to ira x before the end of the year and was advised by custodian b that the assets of ira x would have to be distributed by the end of the day because a_trust trust t was the primary beneficiary of ira x upon this advice taxpayer a signed the ira beneficiary distribution form authorizing custodian b to transfer amount d from ira x to trust t a non-retirement account also maintained with custodian b upon receipt of this authorization custodian b on date distributed the entire value of ira x amount d to trust t taxpayer a states that he subsequently learned that another distribution option of the ira x assets might have been available to beneficiaries f g h and k under sec_401 of the code and the applicable regulations there under even though trust t was named as the primary beneficiary of ira x taxpayer a asked custodian b to reverse the distribution but was informed by custodian b that it did not have the authority to do so taxpayer a has requested that the service under it’s authority to waive the day rollover requirement waive such requirement with respect to the distribution from trust t to taxpayer a and allow amount d to be returned to ira x and allow beneficiaries f g h and k the opportunity to roll over their respective share of the ira x assets to an ira established in their own names so that they can then exercise distribution options under code sec_401 sec_408 of the code provides that except as otherwise provided in sec_408 any amount_paid or distributed out of an ira shall be included in gross_income by the payee or distributee as the case may be in the manner provided under sec_72 of the code rkeekrekereekeererererereree sec_408 of the code defines and provides the rules applicable to ira_rollovers sec_408 of the code provides that sec_408 of the code does not apply to any amount_paid or distributed out of an ira to the individual for whose benefit the ira is maintained if- i ii the entire amount received including money and any other_property is paid into an ira for the benefit of such individual not later than the day after the day on which the individual receives the payment or distribution or the entire amount received including money and any other_property is paid into an eligible_retirement_plan other than an ira for the benefit of such individual not later than the day after the day on which the payment or distribution is received except that the maximum amount which may be paid into such plan may not exceed the portion of the amount received which is includible in gross_income determined without regard to sec_408 sec_408 of the code provides that sec_408 does not apply to any amount described in sec_408 received by an individual from an ira if at any time during the 1-year period ending on the day of such receipt such individual received any other amount described in sec_408 from an ira which was not includible in gross_income because of the application of sec_408 sec_408 of the code denies rollover treatment for inherited iras sec_408 provides that in the case of an inherited ira- i this paragraph shall not apply to any amount received by any individual from such an account or annuity and no amount transferred from such account or annuity to another individual_retirement_account or annuity shall be excluded fromm gross_income by reason of such transfer and such inherited account or annuity shall not be treated as an individual_retirement_account or annuity for purposes of determining whether any other amount is a rollover_contribution sec_408 of the code defines inherited ira and provides that an individual_retirement_account or annuity shall be treated as inherited if- kkrekekeekkrerrererereeere i ii the individual for whose benefit the account or annuity is maintained acquired such account by reason of the death of another individual and such individual was not the surviving_spouse of such other individual sec_408 of the code provides that the secretary may waive the day requirement under sec_408 and sec_408 of the code where 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 occur after date are eligible for the waiver under sec_408 of the code revproc_2003_16 2003_4_irb_359 provides that in determining whether to grant a waiver of the 60-day rollover requirement pursuant to code sec_408 the service will consider all relevant facts and circumstances including errors committed by a financial_institution inability to complete a rollover due to death disability hospitalization incarceration restrictions imposed by a foreign_country or postal error the use of the amount distributed for example in the case of payment by check whether the check was cashed and the time elapsed since the distribution occurred with respect to whether or not amount d can be returned to ira x documentation submitted in this request for a ruling indicates that taxpayer a to distribute the ira x completed a distribution form authorizing custodian b assets to trust t the beneficiary so named by individual m as the primary beneficiary of ira x trust t was named by individual m prior to his death as the primary beneficiary of ira x and upon individual m’s death the entire value of ira x per that prior beneficiary designation should have been made to trust t revproc_2003_16 authorizes the service to waive the 60-day rollover requirement where the failure to waive such a requirement would be against equity or good conscience there is nothing in sec_408 of the code or revproc_2003_16 that would allow the service under this authority to override the payment of a distribution to the beneficiary named by the ira owner to receive the distribution upon the ira owner's death you further ask that beneficiaries f g h and k be allowed to roll over their respective portion of the ira x assets to an ira established in their own names in this case individual m named trust t as the beneficiary of ira x sec_1_401_a_9_-4 q a-3 a of the final income_tax regulations under code sec_401 and sec_408 which were published in the federal_register pincite federal_register date and in the internal_revenue_bulletin pincite_19_irb_852 date provides that only individuals may be designated beneficiaries for purposes of sec_401 a person that is krrrerekekrrerekrerererererke not an individual such as an employee’s estate may not be a designated_beneficiary further sec_1_401_a_9_-4 q a-5 a of the final regulations provides in pertinent part that a_trust is not a designated_beneficiary even though the trust is named as a beneficiary consequently trust tis nota designated_beneficiary of ira x even though it was named by individual m as the beneficiary of ira x however sec_1_401_a_9_-4 q a-5 a of the final regulations further provides that the if the requirements of paragraph b of q a are met and the required_documentation as described in section q a-6 b required minimum distributions after death is provided to the plan_administrator by the trustee of the trust the beneficiaries of the trust will be treated as having been designated as beneficiaries of the employee under the plan for purposes of code section if these requirements are met the trust is a see-through trust and i sec_401 a named beneficiary of the ira as of the date of the ira owner's death and the beneficiaries of the trust with respect to the trust's interest in the ira may be considered designated beneficiaries for purposes of determining the distribution period for payment of benefits from the ira under code sec_401 beneficiaries f g h and k are described and identified in trust t as the surviving children of individual m as surviving children of individual m their respective share of the ira x assets is treated as an inherited ira under code sec_408 because they would have acquired their respective share by reason of the death of individual m and further because they are not the surviving_spouse of individual m with respect to iras the 60-day rollover requirement is only applicable to distributions from iras that meet the requirements of code sec_408 and sec_408 the 60-day rollover requirement does not apply to inherited iras because sec_408 of the code denies rollover treatment for such iras therefore assuming trust t meets the requirements of q a-5 and q a-6 of sec_1 a -4 of the final regulations and further assuming that beneficiaries f g h and k would have been deemed the designated beneficiaries of ira x their respective share of ira x is considered an inherited ira and consequently is not eligible for rollover treatment under the code a nonspousal beneficiary can only direct a trustee-to-trustee transfer of an ira although the ira meets the description of an inherited ira as opposed to a rollover of an ira from one trustee or custodian to another further beneficiaries f g h and k’s respective share of the ira x assets would be considered an inherited ira even if they received their respective share directly from ira x therefore with respect to your ruling_request we conclude that amount d cannot be redeposited into ira x and further conclude that beneficiaries f g h and k's respective share of the ira x assets is not eligible for rollover treatment krkekkekerererekrererereer 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 the regulations which may be applicable thereto this ruling is directed only to the taxpayer that requested it sec_6110 of the code provides that it may not be used or cited by others as precedent a copy of this letter_ruling has been sent to your authorized representative pursuant to a power_of_attorney on file in this office if you have any questions concerning this ruling please contact hare kkk err ker arke her ere raei arerr set ep ra t2 sincerely yours eagned dotgr b fuitd joyce e floyd manager employee_plans technical group enclosures deleted copy of ruling letter notice of intention to disclose


department of the treasury internal_revenue_service washington d c 2uu516022 tax_exempt_and_government_entities_division uic jan set ep lek td legend individual a individual b individual c individual d individual e individual f amount c amount d company g company h trust t ira annuity x state z date date date date 20u516022 page month month month month dear fil this is in response to a request dated submitted on behalf of the personal representative of individual b now deceased by her authorized representative as supplemented by correspondence dated for a ruling to waive the 60-day rollover requirement contained in sec_408 of the internal_revenue_code the code’ and the authorized representative has submitted the following facts and representations in support of the ruling_request individual a a resident of state z whose date of birth was date was the holder of ira annuity x with company g at his death which occurred on date the date of death value of ira annuity x was approximately amount d married to individual b individual d at his death individual a was individual a was also survived by his daughters individual c and as of date individual a had attained age individual a had purchased ira annuity x during month individual b was named the sole primary beneficiary of individual a’s ira annuity x the value of ira annuity x at the time of purchase was approximately amount c by means of a durable_power_of_attorney ‘dpoa’ executed on or about date individual b named individuals c and d as her co-attorneys in fact to serve if individual a was ever unwilling or unable to act as such it has been represented that the dpoa was valid under the laws of state z article lv of the dpoa titled banking transactions gives individual b’s attorneys in fact the authority to take actions listed therein with respect to individual b’s accounts or deposits in financial institutions financial_institution was defined as banks savings associations and other financial institutions’ it has been represented that individual b had been suffering from the effects of alzheimer’s disease from month until her death during month subsequent to individual a’s death on or about date individual c one of the co-attorneys in fact of individual b acting within her authority under the dpoa with the assistance of her financial advisor individual e completed a company h option election form on behaif of her mother individual b which was intended to effectuate a rollover of the amounts standing in individual a’s ira annuity x into an ira set up and maintained in the name of individual b with company h this action was taken after a discussion with individual d the other co-attorney in fact of individual b and pursuant to the dpoa referenced above on the form completed on or about date titled application_for annuity the section headed owner’ was to be left blank if the annuity was to be an ira annuity completed furthermore in another section headed plan a number of options were provided including ira in this section the choice selected was other-annuity the application_for annuity was signed by individual c on behalf of individual b and by individual e as agent of individual c individual b did not sign said form individual c is the beneficiary named on the date application individual b had attained age as of date this section was as noted above individual b died during month month did not fall within 60-days of date subsequent to individual b’s death during month company h advised individual c in writing that company h had issued individual b a non- qualified non-ira annuity pursuant to the date application and could not convert said non-ira annuity to an ira annuity furthermore as a result of the issuance of said non-ira annuity a taxable_distribution in the amount of amount d had been made to individual b the documentation which accompanied this application_for letter_ruling includes an affidavit signed by individual e which indicates in relevant part that the intention of the transfer was to be under the ira qualified provision your authorized representative indicates that the transfer referenced in the affidavit was the transfer effectuated by the date application a form 1099-r distributions from pensions annuities retirement or profit-sharing_plans iras insurance contracts etc which accompanied this ruling_request indicates that individual b received a taxable_distribution in amount d with respect to the calendar_year with respect to the above referenced form 1099-r your authorized representative has asserted on your behalf that after the death of individual b during calendar_year individual c as administrator of the estate of individual b contacted individual f an employee of company h to inquire as to appropriate steps to take with respect to individual b’s ira in response to individual c’s inquiry company h determined that individual b did not have an ira at her death due to the manner in which the date application had been completed this led to company h’s month correspondence with individual c referenced above furthermore company h also determined that it had failed to issue a form 1099-r with respect to the calendar_year transfer into a non-qualified annuity the above referenced form 1099-r was then issued as a result of individual c’s inquiry several months after the 60-day rollover period applicable to individual a’s ira annuity x had expired and after individual b’s death your authorized representative has also asserted that the month letter to individual c and the form 1099-r referenced above represent the only correspondence received by individual c indicating that the date application effectuated a transfer of individual a’s ira annuity x into a non-ira annuity page based on the facts and representations you request that the service waive the 60-day rollover requirement with respect to the distribution from ira annuity x of amount d because the failure to waive such requirement would be against equity or good conscience and permit amount d to be rolled over into an ira set up and maintained in the name of individual b with respect to your ruling_request sec_408 of the code provides that except as otherwise provided in sec_408 any amount_paid or distributed out of an ira shall be included in gross_income by the payee or distributee as the case may be in the manner provided under sec_72 of the code sec_408 of the code defines and provides the rules applicable to ira_rollovers sec_408 of the code provides that sec_408 of the code does not apply to any amount_paid or distributed out of an ira to the individual for whose benefit the ira is maintained if i the entire amount received including money and any other_property is paid into an ira for the benefit of such individual not later than the day after the day on which the individual receives the payment or distribution or ii the entire amount received including money and any other_property is paid into an eligible_retirement_plan other than an ira for the benefit of such individual not later than the day after the date on which the payment or distribution is received except that the maximum amount which may be paid into such plan may not exceed the portion of the amount received which is includible in gross_income determined without regard to sec_408 sec_408 of the code provides that sec_408 does not apply to any amount described in sec_408 received by an individual from an ira if at any time during the 1-year period ending on the day of such receipt such individual received any other amount described in sec_408 from an ira which was not includible in gross_income because of the application of sec_408 sec_408 of the code provides a similar 60-day rollover period for partial rollovers sec_408 of the code provides that paragraph d shall not apply to any amount to the extent such amount is required to be distributed under subsection a or b sec_408 of the code provides in summary that the rollover rules of code sec_408 do not apply to inherited iras sec_408 of the code provides that the term inherited ira means an ira obtained by an individual other than the ira owner's spouse as a result of the death of the ira owner thus in short under circumstances that conform with the requirements of code sec_408 a surviving_spouse who acquires a decedent’s ira after and as a result of the death of an ira owner will be able to roll over the decedent’s ira into an ira set up and maintained in the name of the surviving_spouse page sec_408 of the code provides that the secretary may waive the 60-day requirement under sec_408 and sec_408 of the code 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 date are eligible for the waiver under sec_408 of the code revproc_2003_16 2003_4_irb_359 date provides that in determining whether to grant a waiver of the 60-day rollover requirement pursuant to sec_408 the service will consider all relevant facts and circumstances including errors committed by a financial_institution inability to complete a rollover due to death disability hospitalization incarceration restrictions imposed by a foreign_country or postal error the use of the amount distributed for example in the case of payment by check whether the check was cashed and the time elapsed since the distribution occurred the issue presented in this case is whether code sec_408 and revproc_2003_16 apply to a situation where a surviving_spouse eligible to roll over her deceased husband’s ira annuity x into an ira or ira annuity set up and maintained in her name fails to do so under the circumstances described above including but not limited to her death after the expiration of the 60-day period prescribed by code sec_408 in this case individual c was handling individual b’s financial affairs pursuant to the above-referenced dpoa exercising her authority under said dpoa individual c accomplished a transfer of individual a’s ira annuity x into a non-ira annuity in individual b’s name said transfer was contrary to individual c’s intentions and was due in part to the reliance of it has individual c on the advice of individual e the agent and financial advisor of individual c been represented that individual b because of her medical_condition was not handling her own financial affairs at the time of the transfer date individual c only became aware that the date transfer of ira annuity x had not been made into another ira sometime during month which was after the death of individual b after company h had conducted a review of the contract at that point company h issued a form 1099-r indicating that the date transfer resulted in a taxable_distribution from individual a’s ira annuity x in this case we note that company h failed to issue the form_1099 on a timely basis if it had either individual b or individual c acting on her behalf could have taken corrective action with respect to the date transfer referenced above during individual b’s lifetime said action could have included a request for an extension of the 60-day rollover period based on the facts shown above however because of the timing of the issuance of the form 1099-r individual c did not know that any corrective action was necessary until individual b had died thus no adverse consequences should attach to individual c’s not requesting this letter_ruling during individual b’s lifetime if this request had been submitted during individual b’s lifetime the service would have granted relief under code sec_408 based on the representations contained herein page as noted above the service’s response will not change even though individual b is deceased therefore pursuant to sec_408 of the code the service hereby waives the 60-day rollover requirement with respect to the distribution of amount d and interest thereon from ira annuity x to anon ira annuity you are granted a period of days from the issuance of this ruling letter to complete the rollover of amount d into an ira or ira annuity set up and maintained in the name of individual b deceased provided all other requirements of sec_408 of the code except the 60-day requirement are met with respect to such contributions the amounts deposited into another ira or ira annuity will be considered rollover_contributions within the meaning of sec_408 of the code the service notes that the rollover ira or ira annuity into which amount d will be contributed will not have a designated_beneficiary as that term is defined in code section thus the code sec_401 distribution period with respect to the rollover ira a or ira annuity will be that applicable to an ira owner who had reached her required_beginning_date and died without designating a beneficiary of her ira this ruling does not authorize the rollover of amounts if any that are required to be distributed by sec_401 of the code 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 sec_6110 of the code provides that it may not be used or cited as precedent a copy of this letter has been sent to your authorized representatives in accordance with a power_of_attorney on file in this office ara at either a if you wish to inquire about this ruling please contact esquire id ma phone or a please addr ess all correspondence to se t ep ra t3 sincerely yours parca ui flom frances v sloan manager employee_plans technical group enclosures deleted copy of ruling letter notice of intention to disclose


tax exempt and government entities mment e department of the treasury internal_revenue_service washington d c jul wu uniform issue list be to vra ta legend taxpayer a amount b ira x company c company d company e dear in letters dated date and date your authorized representative requested a waiver of the 60-day rollover requirement contained in sec_408 of the internal_revenue_code the code the following facts and representations have been submitted under penalty of perjury in support of the ruling requested taxpayer a faxed to company c an ira taxpayer a maintains ira x on july bb x withdrawal form and shortly thereafter received an amount b check after consulting with a representative at company d taxpayer a purchased me shares of company with a purchase_price of amount b and instructed company d e stock on july to transfer those shares into a simple_ira account that he had opened with company d the company e stock certificate indicated taxpayer a’s name followed by the letters ira as owner however contrary to taxpayer a's instructions company d never transferred the stock to his simple_ira account the taxpayer discovered the broker error when he received a notice from the internal_revenue_service dated date based on the facts and representations you request that the internal_revenue_service waive the 60-day rollover requirement with respect to the distribution of amount b because the failure to waive such requirement would be a hardship and against equity or good conscience sec_408 of the code provides that except as otherwise provided in sec_408 any amount_paid or distributed out of an ira shall be included in gross_income by the payee or distributee as the case may be in the manner provided under sec_72 of the code sec_408 of the code defines and provides the rules applicable to ira_rollovers sec_408 of the code provides that sec_408 of the code does not apply to any amount_paid or distributed out of an ira to the individual for whose benefit the ira is maintained if - the entire amount received including money and any other_property is paid into i an ira for the benefit of such individual not later than the 60th day after the day on which the individual receives the payment or distribution or the entire amount received including money and any other_property is paid into ii an eligible_retirement_plan other than an ira for the benefit of such individual not later than the 60th day after the date on which the payment or distribution is received except that the maximum amount which may be paid into such plan may not exceed the portion of the amount received which is includible in gross_income determined without regard to sec_408 sec_408 of the code provides that sec_408 does not apply to any amount described in sec_408 received by an individual from an ira if at any time during the 1-year period ending on the day of such receipt such individual received any other amount described in sec_408 from an ira which was not includible in gross_income because of the application of sec_408 sec_408 of the code provides a similar 60-day rollover period for partial rollovers code sec_408 provides in general that rules similar to the rules of sec_401 shall apply to the distribution of the entire_interest of an individual for whose benefit the trust is maintained code sec_408 provides that paragraph d shall not apply to any amount to the extent such amount is required to be distributed under subsection a sec_408 of the code provides that the secretary may waive the 60-day requirement under sec_408 and sec_408 of the code 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 date are eligible for the waiver under sec_408 of the code revproc_2003_16 2003_4_irb_359 date provides that in determining whether to grant a waiver of the 60-day rollover requirement pursuant to sec_408 the service will consider all relevant facts and circumstances including errors committed by a financial_institution inability to complete a rollover due to death disability hospitalization incarceration restrictions imposed by a foreign_country or postal error the use of the amount distributed for example in the case of payment by check whether the check was cashed and the time elapsed since the distribution occurred indicates that taxpayer a relied the information presented on behalf of taxpayer a upon the services of company d to accomplish a rollover of company e stock held under taxpayer a’s name followed by the letters ira taxpayer a instructed company d to rollover company e stock into a new simple_ira in a timely manner company d’s error in not following the request of taxpayer a caused taxpayer a’s failure to make a rollover of amount b within the requisite days _ therefore pursuant to code sec_408 the service hereby waives the 60-day rollover requirement with respect to the withdrawal of amount b pursuant to this ruling letter taxpayer a is granted a period of days measured from the date of the issuance of this letter_ruling to make a rollover_contribution of an amount equal to amount b requirements of code sec_408 except the 60-day requirement are met with respect to such ira contribution the contribution will be considered a rollover_contribution within the meaning of code sec_408 to another ira or iras described in code sec_408 provided all other 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 sec_6110 of the code provides that it may not be used or cited as precedent a copy of this letter has been sent to your authorized representative in accordance with a power_of_attorney on file in this office if youwi d se t ep ra t3 ingui a t this ruling please contact please address all correspondence to sincerely yours rances v sloar manager employee_plans technical group enclosures deleted copy of letter_ruling notice of intention to disclose


internal_revenue_service department of the treasury washington dc person to contact nicole cimino telephone number refer reply to cc dom psi date date general information_letter number info release date index number re sec_528 and qualification as a residential_real_estate_management_association dear this is in response to your letter dated date in which you inquired about the ability of a corporation to qualify as a residential_real_estate_management_association within sec_528 you indicate that the corporation was established by and is comprised of real_property owners in a mixed use community the corporation owns maintains and operates the common areas and improvements within the community the community generally consists of private homes however there are commercial enterprises such as a hotel conference center and a golf course revproc_2001_1 2001_1_irb_8 provides the procedures followed by the internal_revenue_service service for issuing letter rulings determination letters and general information letters a letter_ruling is a written_statement issued to a taxpayer that interprets and applies the tax laws to the taxpayer’s specific set of facts section of the revenue_procedure provides general instructions for requesting letter rulings and determination letters because your request does not comply with the requirements for a private_letter_ruling we cannot issue you a letter_ruling however we are providing this information_letter an information_letter calls attention to a well-established interpretation or principle of tax law without applying it to a specific set of facts an information_letter is advisory only and has no binding effect on the service if in addition to this information_letter you desire a letter_ruling you should submit a request for a ruling prepared in accordance with the instructions provided in revproc_2001_1 sec_528 defines a homeowners_association as an organization which is a condominium_management_association a residential_real_estate_management_association or a timeshare_association if- a such organization is organized and operated to provide for the acquisition construction management maintenance and care of association_property b percent or more of the gross_income of such organization for the taxable_year consists solely of amounts received as membership dues fees or assessments from- i owners of residential units in the case of a condominium_management_association ii owners of residences or residential lots in the case of a residential_real_estate_management_association or iii owners of timeshare rights to use or timeshare ownership interests in association_property in the case of a timeshare_association c percent or more of the expenditures of the organization for the taxable_year are expenditures_for the acquisition construction management maintenance and care of association_property and in the case of a timeshare_association for activities provided to or on behalf of members of the association d no part of the net_earnings of such organization inures other than by acquiring constructing or providing management maintenance and care of association_property and other than by a rebate of excess membership dues fees or assessments to the benefit of any private_shareholder_or_individual and e such organization elects at such time and in such manner as the secretary by regulations prescribes to have this section apply for the taxable_year sec_528 defines a condominium_management_association as any organization meeting the requirements of c a with respect to a condominium project substantially_all of the units of which are used by individuals for residences sec_528 defines a residential_real_estate_management_association as any organization meeting the requirements of c a with respect to a subdivision development or similar area substantially_all the lots or buildings of which are used by individuals for residences sec_1_528-4 of the regulations provides that substantially_all of the units of a condominium_management_association will be considered as used by individuals for residences if at least eighty-five percent of the total square footage of all units within the project is used by individuals for residential purposes sec_1_528-4 of the regulations provides that substantially_all of the lots or buildings of a residential_real_estate_management_association including unimproved lots will be considered as used by individuals as residences if at least eighty-five percent of the lots are zoned for residential purposes you have inquired whether in determining if a residential_real_estate_management_association meets the requirements of sec_528 the service would consider the golf course to be a single lot your question would be an appropriate one in a request for a private_letter_ruling although this letter is a general information_letter not a private_letter_ruling we hope the above information proves helpful sincerely yours joseph h makurath senior technician reviewer branch office of assistant chief_counsel passthroughs and special industries


department of the treasury internal_revenue_service commerce street dallas tx nov uil address address xx date employer identification person to contact id contact telephone taxpayer_advocate s office address telephone number last date to file a petition in tax_court january 20xx tax_exempt_and_government_entities_division legend org organization name release date org address certified mail dear this is a final adverse determination that you do not qualify for exemption from income_tax under sec_501 of the internal_revenue_code i r c as an organization described in sec_501 internal_revenue_service recognition of your status as an organization described in sec_501 is revoked effective january 20xx our adverse determination is made for the following reason s you have not established you are operated exclusively for charitable educational scientific or religious purposes because you failed to comply with the irs’s requests for information to determine if your still qualify for tax exempt status under sec_501 c contributions made to you are no longer deductible as charitable_contributions by donors for purposes of computing taxable_income for federal_income_tax purposes see revproc_82_39 1982_2_cb_759 for the rules concerning the deduction of contributions made to you between february 20xx and the date a public announcement such as publication in the internal_revenue_bulletin is made stating that contributions to you are no longer deductible you are required to file income_tax returns on form_1041 and for all years beginning january 20xx returns for the years ending december 20xx december 20xx december 20xx and december 20xx must be filed with this office within days from the date of this letter unless a request for an extension of time is granted send such returns to the following address tax returns for subsequent years are to be filed with the appropriate campus identified in the instructions for those returns if you decide to contest this determination in court you must initiate a suit for declaratory_judgment in the united_states for the district of columbia before the day after the date this determination was mailed to you contact the clerk of the appropriate court for rules for initiating suits for declaratory_judgment you may write to the tax_court at the following address the processing of income_tax returns and assessment of any taxes due will not be delayed because a petition for declaratory_judgment has been filed under sec_7428 the last day for filing a petition for declaratory_judgment is january 20xx lf you have questions about this letter please write to the person whose name and address are shown on this letter if you write please attach a copy of this letter to help identify your account keep a copy for your records also please include your telephone number and the most convenient time for us to call so we can contact you if we need additional information you also have the right to contact the office_of_the_taxpayer_advocate however you should first contact the person whose name and telephone number are shown above since this person can access your tax information and can help you get answers or you can contact the taxpayer_advocate office located nearest you at the address and telephone number shown in the heading of this letter taxpayer_advocate assistance cannot be used as a substitute for established irs procedures formal appeals processes etc the taxpayer_advocate is not able to reverse legal or technically correct_tax determinations nor extend the time fixed by law that you have to file a petition in the united_states tax_court the taxpayer_advocate can however see that a tax matter that may not nave been resolved through normal channels gets prompt and proper handling we will notify the appropriate state officials of this action as required by sec_6104 this is a final revocation letter sincerely lois g lemer director exempt_organizations enclosures pub form 886-a schedule number or exhibit report of examination eae 2z2uusu8 u83 name of taxpayer tax identification_number org me legend org organization name officer officer address address xx date year period ended december 20xx issue name tax exempt status per return per exam 990-pf december 20xx issue whether org qualifies for exemption under sec_501 of the internal_revenue_code facts org failed to file the required form_990-pf for the tax period s ending december 20xx org failed to respond to the internal_revenue_service attempts to obtain information to perform an examination of form_990-pf for the above mentioned tax period the service requested information as follows e e e e e e november 20xx - the organization as part of a compliance check was sent letter via certified mail the organization was asked to provide a form_990-pf return for the tax periods ending december 20xx 20xx and 20xx the certified receipt was signed on november 20xx the organization did not respond to the initial letter two messages were left on the voice mail of officer an officer of the organization officer did not reply to the voice messages december 20xx - the compliance check was changed to an examination a revenue_agent sent letter to the organization requesting various records and form 990-pfs february 20xx - a follow-up letter was sent certified mail a copy of the initial examination letter was attached which request records and form_990 pfs the letter was returned from the united_states postal service as undeliverable april 20xx - a follow-up letter was sent certified mail to the new address of the organization a copy of the initial examination letter was attached which requested records and form 990-pfs the certified receipt was signed on april 20xx june 20xx and june 20xx -- two messages were left on the voice mail of officer an officer of the organization officer did not reply to the voice messages august 20xx - the organization was issued a report of examination proposing a revocation of their exempt status due to lack of response the report was sent certified mail the organization was allowed days to respond the organization failed to reply to the proposed day revocation letter letter the certified mail receipt was signed on august 20xx form 886-a department of the treasury-internal revenue service catalog number 20810w publish no irs gov page luuz08u report of examination schedule number or exhibit year period ended tax identification_number december 20xx form 886-a rev date name of taxpayer l_ org legend org organization name officer officer address address xx date law sec_1_61-1 of the regulations provides that gross_income means all income from whatever source derived unless excluded by law gross_income includes income realized in any form whether in money property or services income may be realized therefore in the form of services meals accommodations stock or other_property as well as cash sec_511 of the internal_revenue_code imposes a tax at corporate rates under sec_11 on the unrelated_business_taxable_income of certain tax-exempt organizations including those described in sec_501 sec_6001 of the code provides that every person liable for any_tax imposed by the code or for the collection thereof shall keep adequate_records as the secretary_of_the_treasury or_his_delegate may from time to time prescribe sec_1_6001-1 of the regulations states that the books_or_records required by this section shall be kept at all time available for inspection by authorized internal revenue officers or employees and shall be retained as long as the contents thereof may be material in the administration of any internal revenue law sec_6033 of the code provides except as provided in sec_6033 every organization exempt from tax under sec_501 shall file an annual return stating specifically the items of gross_income receipts and disbursements and such other information for the purposes of carrying out the internal revenue laws as the secretary may by forms or regulations prescribe and keep such records render under oath such statements make such other returns and comply with such rules and regulations as the secretary may from time to time prescribe sec_1_6033-1 of the regulations provides that every organization which has established its right to exemption from tax whether or not it is required to file an annual return of information shall submit such additional information as may be required by the district_director for the purpose of enabling him to inquire further into its exempt status and to administer the provisions of subchapter_f sec_501 and the following chapter of the code and sec_6033 sec_1_501_c_3_-1 of the regulations states that in order to be exempt as an organization described in sec_501 an organization must be both organized and operated exclusively for one or more of the purposes specified in such section if an organization fails to meet either the organizational_test or the operational_test it is not exempt sec_501 of the code provides that an organization organized and operated exclusively for charitable or educational_purposes is exempt from federal_income_tax provided no part of its net_earnings inures to the benefit of any private_shareholder_or_individual sec_501 of the code provides that a civic organization not organized for profit but operated exclusively for the promotion of social welfare is exempt from federal_income_tax form 886-a publish no irs gov - department of the treasury-internal revenue service catalog number 20810w page form 886-a rev date noo report of examination schedule number or exhibit name of taxpayer tax identification_number org year period ended december 20xx legend org organization name officer officer address address xx date sec_501 provides for the exemption from federal_income_tax of a post or organization of veterans of the united_states armed_forces if such post or organization is a b c organized in the united_states or any of its possessions at least percent of the members of which are past or present members of the armed_forces_of_the_united_states and substantially_all of the other members of which are individuals who are cadets or are spouses widows or widowers of past or present members of the armed_forces_of_the_united_states or cadets and no part of the net_earnings of which inures to the benefit of any private_shareholder_or_individual sec_1_501_c_19_-1 provides that an organization described in sec_501 of the code must be operated exclusively for one or more of the purposes listed in that section sec_1_501_c_19_-1 in order to be described in sec_501 an organization must be operated exclusively for one or more of the following purposes w w a m a n o s to promote the social welfare of the community to assist disabled and needy war veterans and members of the united_states armed_forces and their dependents to provide entertainment care and assistance to hospitalized veterans to carry on programs to perpetuate the memory of deceased veterans to conduct programs for religious charitable scientific literary or educational_purposes to sponsor or participate in activities of patriotic nature to provide insurance benefits for their members to provide social and recreational activities for their members sec_1_501_c_3_-1 of the regulations provides that an organization will not be regarded as operated exclusively for one or more exempt purposes described in sec_501 of the code if more than an insubstantial part of its activities is not in furtherance of a c purpose accordingly the organization does not qualify for exemption under sec_501 of the code sec_1_501_c_10_-1 of the regulations provides that a domestic fraternal beneficiary society order or association will only qualify if it devotes its net eamings exclusively to religious charitable scientific literary educational and fraternal purposes revrul_59_95 1959_1_cb_627 concerns an exempt_organization that was requested to produce a financial statement and statement of its operations for a certain year however its records were so incomplete that the organization was unable to furnish such statements the service held that the failure or inability to file the required information_return or otherwise to comply with the provisions of sec_6033 of the code and the regulations which implement it may result in the termination of the exempt status of an organization previously held exempt on the grounds that the organization has not established that it is observing the conditions required for the continuation of exempt status form 886-a department of the treasury-internal revenue service catalog number 20810w publish no irs gov page form 886-a nana name of taxpayer org report of examination tax identification_number year period ended december 20xx schedule number or exhibit legend org organization name officer officer address address xx date taxpayer’s position the organization failed to reply to the proposed day revocation letter letter the certified mail receipt was signed on august 20xx conclusion in accordance with the above-cited provisions of the code and regulations under sec_6001 and sec_6033 organizations recognized as exempt from federal_income_tax must meet certain reporting requirements these requirements relate to the filing of a complete and accurate annual information and other required federal tax forms and the retention of records sufficient to determine whether such entity is operated for the purposes for which it was granted tax-exempt status and to determine its liability for any unrelated_business_income_tax it is the irs's position that the organization failed to meet the reporting requirements under sec_6001 and sec_6033 to be recognized as exempt from federal_income_tax under c of the internal_revenue_code accordingly the organization's exempt status is revoked effective january 20xx form 886-a department of the treasury-internal revenue service catalog number 20810w ppublish no irs gov page department of the treasury internal_revenue_service m s p o box ogden ut tax_exempt_and_government_entities_division legend org organization name address address org address taxpayer_identification_number form s 990-pf tax_year s ended person to contact id number contact numbers telephone fax certified mail - return receipt requested dear we have enclosed a copy of our report of examination explaining why we believe revocation of your exempt status under sec_501 of the internal_revenue_code code is necessary lf you accept our findings take no further action we will issue a final revocation letter if you do not agree with our proposed revocation you must submit to us a written request for appeals_office consideration within days from the date of this letter to protest our decision your protest should include a statement of the facts the applicable law and arguments in support of your position an appeals officer will review your case the appeals_office is independent of the director eo examinations the appeals_office resolves most disputes informally and promptly the enclosed publication the examination process and publication exempt_organizations appeal procedures for unagreed issues explain how to appeal an internal_revenue_service irs decision publication also includes information on your rights as a taxpayer and the irs collection process you may also request that we refer this matter for technical_advice as explained in publication if we issue a determination_letter to you based on technical_advice no further administrative appeal is available to you within the irs regarding the issue that was the subject of the technical_advice if we do not hear from you within days from the date of this letter we will process your case based on the recommendations shown in the report of examination if you do not protest this proposed determination within days from the date of this letter the letter rev catalog number 34809f 2uu8080 irs will consider it to be a failure to exhaust your available administrative remedies sec_7428 of the code provides in part a declaratory_judgment or decree under this section shall not be issued in any proceeding unless the tax_court the claims_court or the district_court of the united_states for the district of columbia determines that the organization involved has exhausted its administrative remedies within the internal_revenue_service we will then issue a final revocation letter we will also notify the appropriate state officials of the revocation in accordance with sec_6104 of the code you have the right to contact the office_of_the_taxpayer_advocate taxpayer_advocate assistance is not a substitute for established irs procedures such as the formal appeals process the taxpayer_advocate cannot reverse a legally correct_tax determination or extend the time fixed by law that you have to file a petition in a united_states court the taxpayer_advocate can however see that a tax matter that may not have been resolved through normal channels gets prompt and proper handling you may call toll-free and ask for taxpayer_advocate assistance if you prefer you may contact your local taxpayer_advocate at taxpayer_advocate if you have any questions please call the contact person at the telephone number shown in the heading of this letter the most convenient time to call if we need to contact you if you write please provide a telephone number and thank you for your cooperation sincerely biorsha karmise marsha ramirez director eo examinations enclosures publication publication form 4621-a report of examination form_6018 form 886-a explanation of items letter rev catalog number 34809f


department of the treasury internal_revenue_service washington d c number info release date dear date cc dom it a cor-118352-99 uil-1001 we have received your letter dated date to the internal_revenue_service a copy of which is enclosed concerning the computation of gain in connection with shares of stock that you exchanged in for cash and shares of stock we understand that susan kassell of this office telephoned you several weeks ago and left you a message explaining about a shareholder’s tax_liability in a taxable merger this will provide you with general information about taxable exchanges of stock generally gross_income includes all income from whatever source derived including but not limited to gain derived from dealing in property which is the excess of the amount_realized over the adjusted_basis of the property the character of the gain will depend on the nature of the asset sold a capital_asset is property held by the taxpayer excluding certain types of property not apparently involved here stock generally constitutes a capital_asset under this broad definition there are exceptions to the requirement that a taxpayer must include in income gain derived from dealing in property where for example stock is exchanged for other stock in a tax-free merger however the letter of instruction from letter indicates that the therefore even though you continue to own the required to pay tax on the gain from the measured by the excess of the amount_realized the cash and fair_market_value of the stock received over the adjusted_basis of the stock merger was a taxable_exchange stock you are stock as described above that gain is attached to your cor-118352-99 we hope that this information is helpful if we may be of further assistance please do not hesitate to contact ms kassell at sincerely michael d finley chief branch income_tax accounting enclosure


t c memo united_states tax_court george n gerakios a k a jorge n gerakios petitioner v commissioner of internal revenue respondent docket no 11125-02l filed date george n gerakios pro_se john d faucher for respondent memorandum opinion vasquez judge this case is before the court on respondent’s motion to dismiss on the ground of mootness the motion the issue for decision is whether petitioner’s case is moot it is unclear whether at some point petitioner was raising a refund claim in this proceeding at the hearing continued background on or about date respondent issued a final notice_of_intent_to_levy and notice of your right to a hearing to petitioner for his tax_liabilities for and on or about date respondent issued a notice_of_federal_tax_lien and notice of your right to a hearing to petitioner for his tax_liabilities for and pursuant to the aforementioned notices petitioner requested a section hearing on date respondent issued a notice_of_determination concerning collection action s under sec_6320 and or sustaining the proposed collection action on date petitioner filed a petition for lien or levy action under code sec_6320 or sec_6330 on or about date in order to refinance his home petitioner paid in full his then-outstanding income taxes continued however petitioner eventually made it clear that the only remedy he was seeking from the court was for the irs to reverse the levy action and remove the lien that was filed--he was not requesting a refund in this proceeding additionally petitioner did not dispute his underlying liabilities in the attachment to the notice_of_determination it states that this notice was issued on date the date of this notice is not in issue as respondent concedes that petitioner timely filed his request for a sec_6330 hearing unless otherwise indicated all section references are to the internal_revenue_code penalties and interest with respect to and on or about date respondent released the lien against petitioner for and respondent no longer intends to pursue any levy action against petitioner for any income taxes penalties or interest for and or as they have been paid in full on date respondent filed the motion on date the court ordered petitioner to file any objection to the motion on or before date on date petitioner filed an objection to the motion the court heard argument on the motion discussion our jurisdiction under sec_6330 is generally limited to reviewing whether the proposed lien or levy action is proper chocallo v commissioner tcmemo_2004_152 respondent released the lien and has stated that he is no longer pursuing the proposed levy as the parties now agree that there is no unpaid liability for or upon which a lien or levy could be based we agree with respondent that the case is moot id we note that petitioner claimed respondent’s employees mistreated him respondent’s employees violated his civil rights and that his credit rating was adversely affected by the filing of the lien petitioner did not cite or rely on any specific statute as a basis for these claims and we generally have no jurisdiction over such matters id if petitioner meant to make a sec_7433 claim which provides for up to dollar_figure million in civil damages for certain unauthorized collection actions we note that such claims must be brought in a district_court of the united_states sec_7433 chocallo v commissioner supra petitioner has received all the relief to which he is entitled under sec_6320 and sec_6330 accordingly we shall grant the motion and shall dismiss this case as moot to reflect the foregoing an appropriate order of dismissal will be entered granting respondent’s motion to dismiss on the ground of mootness


internal_revenue_service department of the treasury number release date index number washington dc person to contact refer reply to cc psi 1-plr-143978-02 date date telephone number legend x state d1 dear this responds to your letter dated date requesting relief under sec_1362 of the internal_revenue_code facts x was incorporated on d1 under the law of state the shareholder of x intended that x be treated as an s_corporation effective on d1 but the election to be treated as an s_corporation was not timely filed accordingly x requests a ruling that it will be treated as an s_corporation effective d1 law and analysis sec_1362 provides that a small_business_corporation may elect to be an s_corporation sec_1362 provides the rule on when an s election will be effective sec_1362 provides in relevant part that if an s election is made within the first two and one-half months of a corporation's taxable_year then the corporation will be treated as an s_corporation for the year in which the election is made under sec_1362 however if an s election is made after the first two and one-half months plr-143978-02 of a corporation's taxable_year then that corporation will not be treated as an s_corporation until the taxable_year after the year in which the s election is filed sec_1362 provides that if no sec_1362 election is made for any taxable_year and the secretary determines that there was reasonable_cause for the failure to timely make such election then the secretary may treat such an election as timely made for such taxable_year and sec_1362 shall not apply x did not file an election to be treated as an s_corporation under sec_1362 x has however established reasonable_cause for not making a timely s election and is entitled to relief under sec_1362 conclusion based solely on the facts submitted and the representations made and provided that x otherwise qualifies as an s_corporation we conclude that x will be treated as an s_corporation effective d1 within days from the date of this letter x should submit a properly completed form_2553 with a copy of this letter attached to the appropriate service_center except as specifically set forth above no opinion is expressed or implied as to the federal tax consequences of the facts described above under any other provision of the code specifically no opinion is expressed concerning whether x is in fact an s_corporation for federal tax purposes this ruling is directed only to the taxpayer requesting it sec_6110 of the code provides that it may not be used or cited as precedent sincerely s david r haglund senior technician reviewer branch office of the associate chief_counsel passthroughs and special industries enclosures copy of this letter copy for sec_6110 purposes cc


internal_revenue_service department of the treasury index number washington dc person to contact telephone number refer reply to cc tege eb qp2-cor-131254-01 date date number info release date this responds to your letter of date addressed to the office of division counsel associate chief_counsel tax exempt and government entities internal_revenue_service your letter inquired regarding the reasons that the rules regulating distributions and transfers from sec_457 deferred_compensation plans are less flexible than the rules regarding distributions from sec_401 plans such as the ones offered by your former employer we do not have sufficient information regarding your employer ie whether it is a governmental entity or a tax-exempt_organization or the sec_457 plan it sponsors including a copy of the plan to definitively discuss your case and options under that plan however we can provide some general information that may be helpful to you a deferred_compensation plan such as an eligible sec_457 plan is an agreement or arrangement between an employer and employees under which the payment of compensation is deferred the tax consequences of such plans are currently governed by the constructive_receipt_doctrine embodied in the regulations under sec_451 of the internal_revenue_code and in the case of state and local governmental and tax-exempt employers sec_457 of the code the constructive receipt of income doctrine has long been a part of the income_tax laws under this doctrine a taxpayer will be subject_to tax upon an item_of_income if he has an unrestricted right to determine when such an item_of_income should be paid this principle was expressed in a supreme court case 281_us_376 in a statement by justice holmes that i ncome that is subject_to a man’s unfettered command and that he is free to enjoy at his own option may be taxed to him as his income whether he sees fit to enjoy it or not the doctrine is embodied in sec_1_451-1 of the income_tax regulations which states that an item_of_income for example compensation_for services is includible in gross_income for the taxable_year in which it is actually or constructively received sec_1_451-2 of the regulations states that income is constructively received in the year in which although not actually received it was made available so that the taxpayer could actually receive it at any time if notice of intention to receive it cor-131254-01 has been given however income is not constructively received if the taxpayer’s control_over its receipt is subject_to substantial limitations or restrictions also as discussed below a special exception in sec_457 allows participants and beneficiaries in an eligible_deferred_compensation_plan to request and receive limited accelerated withdrawals from their accounts to meet their hardship needs due to an unforeseeable_emergency sec_457 which congress enacted in provides special rules whereby an individual who participates in such a plan will not be deemed to be in constructive receipt of a portion of his compensation_for services rendered to an eligible_employer such as a state_or_local_government entity or a tax-exempt_organization for this purpose a plan is treated as an eligible_plan if the plan provisions conform to the requirements of sec_457 of the code and the plan is administered in conformance with those requirements sec_457 provides that compensation deferred under an eligible_plan and any income attributable to such deferred_compensation are taxable only for the year in which the deferred amounts are paid or otherwise made available to the plan participant or the participant’s beneficiary not in the year deferred sec_1_457-1 of the regulations states in part that for purposes of sec_457 of the code amounts deferred under an eligible_plan will not be considered made available if under the plan the participant may irrevocably elect prior to the time the amounts become payable under the distribution provisions of the plan to defer payment of some or all of these amounts to a fixed or determinable future time conversely amounts are made available if the participant’s election is not irrevocable may be made after the amounts become payable or is not to a fixed or determinable future date in keeping with the doctrine_of constructive receipt this means the participant’s election must be one to delay the payment_date rather than accelerate it examples and of sec_1_457-1 indicate that eligible deferred_compensation plans may provide that their participants may change their distribution election up to or days depending upon the specific terms of the plan before the date upon which payments are to commence in order for the internal_revenue_service as well as plan participants to ascertain when deferred amounts become payable an eligible_plan must specify a fixed or determinable time of payment by reference to the occurrence of an event for example retirement that triggers the individual's right to receive or begin to receive the amounts deferred under the plan your description of the distribution provisions of your former employer's sec_457 plan sounds similar to those of many sec_457 plans we've seen which establish a mandatory default provision governing the time and manner of distribution for participants who do not make a timely distribution election within days of their separation_from_service however we are unable to determine whether your plan_administrator accurately describes its plan's distribution provision without examining the plan document cor-131254-01 under sec_457 of the code and the regulations thereunder as well as under the long established doctrine_of constructive receipt of income if a plan participant were able to receive his deferred income at any time without restriction after he retired he would be in constructive receipt of these amounts in the taxable_year of his retirement even if they were not actually paid under sec_457 of the code the participant’s ability to control the time when he would receive these amounts would make the deferred amounts available to him and includible in gross_income for the year in which he retired example of sec_1_457-1 indicates that if a sec_457 plan permits a participant to change his distribution election after he has begun receiving distributions from his account he would be currently taxable upon the entire value of his account whether or not he had elected to receive it immediately there is an exception to this general_rule relating to emergencies under sec_457 of the internal_revenue_code the plan and its sponsoring employer or administrator may but is not required to permit a participant to accelerate the payment of the amount remaining payable in the event of an unforeseeable_emergency sec_1_457-2 of the regulations defines an unforeseeable_emergency as severe financial hardship to the participant resulting from a sudden and unexpected illness or accident of the participant or of a dependent loss of the participant's property due to casualty or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the participant benefits would not be made available merely because the plan contained such a provision this is a sec_457 statutory exception that permits a plan_sponsor or administrator to release funds from a participant's sec_457 plan account before the time otherwise authorized in the sec_457 plan document the congress developed the current rules for sec_457 plans based on nonqualified_plan concepts sec_457 plans therefore are currently subject_to different and often less stringent regulations than are funded qualified_retirement_plans such as sec_401 plans which must comply with complex rules to assure parity in who they cover and how much can be deferred an attendant feature of sec_457 plans is that in some respects they may provide less flexibility to participants than do qualified_plans for example one advantage of qualified_plans is that employees who separate from service or retire are eligible to roll over the amounts in their accounts to individual_retirement_accounts ira or other qualified_plans where the money may remain until that employee is required to take a distribution under the minimum_distribution_rules of the code this is in marked contrast to present law regarding a sec_457 plan where once the participant is eligible to receive the funds there is no way under current law that a participant can further defer them income_tax free unless that participant transfers the funds to another eligible sec_457 deferred_compensation plan the transfer of deferred amounts from one eligible sec_457 plan to another eligible_plan under sec_457 is the only exception that is currently provided cor-131254-01 no similar exception is now provided for a rollover or transfer of funds to any other type of plan or arrangement including an ira making sec_457 plans similar to sec_401 plans requires the congress to enact statutory revisions such as the ones it has just enacted and the president has just signed into law as the economic_growth_and_tax_relief_reconciliation_act_of_2001 pub_l_no this new law provides that after distributions from a sec_457 plan are includible in income when paid rather than when paid or made available that would authorize sec_457 plans to provide more flexible distribution provisions if they are revised to permit such flexibility in addition the new law provides that after sec_457 plan distributions that qualify as eligible rollover distributions may be rolled over into an ira or subject_to certain restrictions to other plans such as sec_401 or sec_403 plans however these revisions easing the application of the constructive_receipt_doctrine and authorizing certain rollovers from sec_457 plans to iras do not become effective until and they generally apply only to sec_457 plans sponsored by state and local governmental entities not to plans sponsored by tax-exempt employers however for a governmental sec_457 plan participant to be able to take advantage of these new provisions after his governmental employer's plan must be revised to permit the use of these new provisions we trust this information will be helpful to you sincerely robert d patchell acting branch chief qualified_plans branch office of associate chief_counsel tax exempt and government entities


internal_revenue_service number release date index number --------------------------- ----------------------------------------------- -------------------------------------- --------------------------- -------------------------------------- --------------------- department of the treasury washington dc third party communication none date of communication not applicable_person to contact ----------- id no ------------- telephone number -------------------- refer reply to cc psi b01 plr-151980-05 date date --------------------- ------------------------------- legend legend x -------------------------------------------------- country d dear -------------- correspondence written on behalf of x requesting an extension of time under ' and ' of the procedure and administration regulations to elect to be treated as a partnership for federal tax purposes this letter responds to the letter dated date and related --------------------- facts the information submitted states that x was incorporated under the laws of country on d x intended to file a form_8832 entity classification election to be treated as a partnership for federal tax purposes effective d however the election was not timely filed plr-151980-05 law and analysis sec_301_7701-3 provides that a business_entity that is not classified as a corporation under ' b or an eligible_entity can elect its classification for federal tax purposes elections are necessary only when an eligible_entity does not want to be classified under the default classification or when an eligible_entity chooses to change its classification sec_301_7701-3 provides that except for certain existing entities described in sec_301_7701-3 unless a foreign eligible_entity elects otherwise the entity is a a partnership if it has two or more members and at least one member does not have limited_liability b an association if all members have limited_liability or c disregarded as an entity separate from its owner if it has a single member that does not have limited_liability sec_301_7701-3 provides that an eligible_entity may elect to be classified other than as provided under ' b by filing form_8832 with the appropriate service_center under ' c iii this election will be effective on the date specified by the entity on form_8832 or on the date filed if no such date is specified the date specified on form_8832 cannot be more than days prior to the date on which the election is filed under sec_301_9100-1 the commissioner may grant a reasonable extension of time to make a regulatory election or a statutory election but no more than six months except in the case of a taxpayer who is abroad under all subtitles of the code except e g h and i sec_301_9100-1 defines the term regulatory election as including an election whose deadline is prescribed by a regulation published in the federal_register commissioner will use to determine whether to grant an extension of time to make an election sec_301_9100-2 provides automatic extensions of time for making certain elections sec_301_9100-3 provides extensions of time for making elections that do not meet the requirements of sec_301_9100-2 requests for relief under sec_301_9100-3 will be granted when the taxpayer provides evidence to establish that the taxpayer acted reasonably and in good_faith and that granting relief will not prejudice the interests of the government sec_301_9100-1 through provide the standards the conclusion based solely on the facts submitted and representations made we conclude that x has satisfied the requirements of and and therefore it is granted an extension of time of sixty days from the date of this letter to file a form plr-151980-05 to elect to be treated as a partnership for federal tax purposes effective d a copy of this letter should be attached to the election a copy is enclosed for that purpose except as specifically set forth above we express no opinion concerning the federal tax consequences of the facts described above under any other provision of the internal_revenue_code this ruling is directed only to the taxpayer requesting it sec_6110 of the code provides that it may not be used or cited as precedent in accordance with the power_of_attorney on file with this office a copy of this letter is being mailed to your authorized representative sincerely enclosures heather c maloy associate chief_counsel passthroughs and special industries copy of this letter copy for ' purposes cc