t c memo united_states tax_court charles m worthley petitioner v commissioner of internal revenue respondent docket no filed date charles m worthley pro_se gary s gross for respondent memorandum findings_of_fact and opinion foley judge respondent determined the following deficiency and additions to tax relating to petitioner's federal income taxes year deficiency -- dollar_figure additions to tax sec_6653 sec_6654 dollar_figure big_number -- dollar_figure as an alternative position respondent in his answer asserted that petitioner is liable for additions to tax pursuant to sec_6651 and sec_6653 unless otherwise stated all section references are to the internal_revenue_code in effect for the years in issue and all rule references are to the tax_court rules_of_practice and procedure on date respondent pursuant to rule f submitted a motion to show cause why proposed facts in evidence should not be accepted as established respondent attached a stipulation of facts and related exhibits to the motion this court on date granted respondent's motion and issued an order requiring petitioner to show cause why the facts set forth in respondent's motion should not be deemed admitted on date filed petitioner's response to this court's order to show cause and on date ordered that certain facts contained in respondent's stipulation of facts be deemed stipulated on date respondent served requests for admissions on petitioner petitioner did not respond to the requests and as a result the facts contained therein were deemed admitted rule c 65_tc_333 affd 565_f2d_954 5th cir this case was called from the calendar of this court's date trial session in boston massachusetts and petitioner failed to appear in person or through counsel respondent filed a motion asking this court to find petitioner in default and enter a decision against him by order dated date this court granted respondent's motion in part and held petitioner liable for the underlying deficiency and the sec_6654 addition_to_tax this court denied respondent's motion with respect to the sec_6653 additions to tax and restored the case to the general docket for trial this case was subsequently called from the calendar of this court's date trial session in boston massachusetts petitioner failed to appear in person or through counsel and respondent rested on the facts previously established pursuant to rule sec_91 and sec_90 respondent on brief conceded that petitioner is not liable for the sec_6653 addition_to_tax relating to petitioner's tax_year as a result the issues we must decide are as follows whether petitioner pursuant to sec_6653 is liable for an addition_to_tax for fraud relating to his tax_year we hold that he is liable whether petitioner pursuant to sec_6651 is liable for an addition_to_tax for failing to file his federal_income_tax return in a timely manner we hold that he is liable whether petitioner pursuant to sec_6653 is liable for an addition_to_tax for negligence relating to his tax_year we hold that he is liable findings_of_fact petitioner resided in gerona spain at the time his petition was filed during the years in issue he was employed by measurex corp measurex a california corporation and by saab-totem inc saab-totem a washington corporation in petitioner received a dollar_figure vacation allowance from measurex and realized a dollar_figure long-term_capital_gain attributable to the sale of big_number shares of measurex stock during that year he also submitted to measurex and saab-totem forms w-4e on these forms petitioner stated under penalties of perjury that he incurred no income_tax_liability for and that he anticipated no income_tax_liability for petitioner submitted to respondent two tax forms relating to and three tax forms relating to on date and date respondent received form sec_1040 relating respectively to petitioner's and tax years petitioner on these forms provided objections based on the fifth_amendment privilege_against self-incrimination to the tax_return filing requirement after receiving these forms the internal_revenue_service irs began investigating petitioner's and tax_liability on date petitioner wrote a letter to don waite an employee of measurex suggesting the following methods by which measurex could delay the irs investigation of petitioner one way to 'delay' would be to write regan asking him for a schedule of payment fees for the documents a second way would be to submit copies of only the front of the checks in the first submission on february and respondent received revised form sec_1040 relating respectively to petitioner's and tax years petitioner on the form reported gross_income of dollar_figure and a tax_liability of dollar_figure petitioner on the form reported wages of dollar_figure petitioner crossed out the declarations that these forms were being submitted under penalties of perjury on date respondent received a form 1040x relating to petitioner's tax_year petitioner reported a tax_liability of dollar_figure and signed the form under penalties of perjury but he failed to report the dollar_figure vacation allowance and the dollar_figure long-term_capital_gain on date a criminal information was filed in the u s district_court for the western district of washington charging petitioner pursuant to sec_7203 with willful failure_to_file and federal_income_tax returns thereafter petitioner left the country on date a u s magistrate issued a bench warrant for petitioner's arrest on date officers from the u s customs service arrested petitioner at logan international airport in boston massachusetts on date before the u s district_court for the district of massachusetts petitioner pled guilty to willfully failing to file in violation of sec_7203 his federal_income_tax return the charge relating to his return was dismissed on date petitioner was convicted sentenced to months' imprisonment and fined dollar_figure i addition_to_tax for fraud opinion respondent determined that petitioner pursuant to sec_6653 is liable for an addition_to_tax for fraud relating to his tax_year sec_6653 provides that if any part of an underpayment_of_tax required to be shown on a return is due to fraud there shall be added to the tax an amount equal to percent of the underpayment fraud is defined as an intentional wrongdoing designed to evade tax 252_f2d_56 9th cir 94_tc_316 respondent bears the burden of proving fraud by clear_and_convincing evidence sec_7454 rule b to carry the burden_of_proof respondent must show for each year in issue that an underpayment_of_tax exists and that some portion of the underpayment is due to fraud 92_tc_661 a underpayment where a taxpayer does not file a return the underpayment equals the correct_tax due see sec_6653 respondent contends that petitioner underpaid his taxes by dollar_figure ie the amount that respondent contends is the correct_tax due in petitioner reported and paid dollar_figure of his tax_liability respondent contends that the remaining portion of the underpayment dollar_figure was attributable to petitioner's failure to report as income the dollar_figure vacation allowance the dollar_figure long-term_capital_gain resulting in a dollar_figure increase in net_capital_gain income and dollar_figure that measurex paid the irs in satisfaction of petitioner's federal_income_tax liability respondent has established by clear_and_convincing evidence that there is an underpayment of petitioner's tax for b fraudulent intent to prove fraud respondent must establish that petitioner intended to evade taxes through conduct designed to conceal mislead or otherwise prevent the collection_of_taxes 80_tc_1111 fraudulent intent is not to be imputed or presumed but may be established by circumstantial evidence and reasonable inferences drawn from the facts 317_us_492 petzoldt v commissioner supra 79_tc_995 affd 748_f2d_331 6th cir the taxpayer's entire course of conduct may establish the requisite fraudulent intent 56_tc_213 petitioner pursuant to sec_7203 was convicted of willfully failing to file his federal_income_tax return while a taxpayer's failure_to_file a tax_return does not standing alone establish fraud an inference of fraud is justified when the failure_to_file is coupled with other badges_of_fraud ie circumstances that establish an intent to conceal or mislead 91_tc_874 these badges include filing false forms w-4 and failing to cooperate with tax authorities id pincite rowlee v commissioner supra pincite5 in petitioner submitted forms w-4e to his employers on these forms petitioner stated under penalties of perjury that he incurred no income_tax_liability for and anticipated no income_tax_liability for petitioner incurred a tax_liability of dollar_figure and during received wages of dollar_figure we find that petitioner knowingly submitted false forms w-4e to his employers in addition he encouraged measurex to delay respondent's investigation of his tax_liability these facts coupled with petitioner's willful failure_to_file his tax_return establish the requisite fraudulent intent accordingly we hold that petitioner is liable for the sec_6653 addition_to_tax ii addition_to_tax for failing to file a return in a timely manner respondent contends that petitioner pursuant to sec_6651 is liable for an addition_to_tax for failing to file his federal_income_tax return in a timely manner respondent bears the burden_of_proof relating to this issue because this contention was made for the first time in the answer rule a in petitioner had gross_income of dollar_figure thus his gross_income exceeded the sum of the applicable standard_deduction and personal_exemption and he was required to file a federal_income_tax return see sec_6012 neither of the form sec_1040 petitioner provided respondent for were returns because they either did not contain sufficient information to compute petitioner's tax_liability or were not signed under penalties of perjury see sec_6065 65_tc_68 affd without published opinion 559_f2d_1207 3d cir therefore petitioner failed to file his tax_return in a timely manner and we hold that he is liable for the sec_6651 addition_to_tax iii addition_to_tax for negligence respondent contends that petitioner pursuant to sec_6653 is liable for an addition_to_tax for negligence relating to his tax_year respondent bears the burden_of_proof relating to this issue because this contention was made for the first time in the answer rule a sec_6653 provides that if any part of an underpayment_of_tax required to be shown on a return is due to negligence or intentional_disregard_of_rules_and_regulations there shall be added to the tax an amount equal to percent of the underpayment petitioner's tax_liability was dollar_figure but he failed to file a return therefore petitioner had an underpayment of dollar_figure see sec_6211 sec_6653 in addition petitioner intentionally disregarded applicable rules and regulations requiring the filing of a return and the reporting of income accordingly we hold that he is liable for the sec_6653 addition_to_tax all other arguments made by the parties are either irrelevant or without merit to reflect the foregoing decision will be entered under rule


department of the treasury washington dc person to contact telephone number refer reply to plr-124645-01 cc intl b1 date date internal_revenue_service number release date index no a date b date c country d dear this is in response to a letter dated b by a’s authorized representative requesting a ruling under sec_877 of the internal_revenue_code_of_1986 code that a’s loss of long-term_resident status did not have for one of its principal purposes the avoidance of u s taxes under subtitle a or subtitle b of the code the ruling contained in this letter is based upon information and representations submitted by the taxpayer and accompanied by penalty of perjury statements executed by an appropriate party while this office has not verified any of the material submitted in support of the request for rulings it is subject_to verification on examination the information submitted for consideration is substantially as set forth below a a long-term_resident of the united_states within the meaning of sec_877 relinquished her u s lawful permanent resident status expatriated on date c a is a citizen of country d the country in which she was born on the date of a’s expatriation her net_worth exceeded the threshold_amount stated in sec_877 sec_877 generally provides that a citizen who loses u s citizenship or a u s long-term_resident who ceases to be taxed as a lawful permanent resident individuals who expatriate within the 10-year period immediately preceding the close of the taxable_year will be taxed under sec_877 and the special rules of sec_877 for such taxable_year unless such loss did not have for one of its principal purposes the avoidance of u s taxes sec_2107 and sec_2501 provide special estate and gift_tax regimes respectively for individuals who expatriate with a principal purpose to avoid u s taxes plr-124645-01 page a former citizen or former long term-resident will be treated as having expatriated with a principal purpose to avoid u s taxes for purposes of sec_877 sec_2107 and sec_2501 if the individual’s average income_tax_liability or the individual’s net_worth on the date of expatriation exceed certain thresholds see sec_877 sec_2107 and sec_2501 a former u s citizen or former long term-resident whose net_worth or average tax_liability exceeds these thresholds however will not be presumed to have a principal purpose of tax_avoidance if that former citizen is described within certain statutory categories and submits a request for a ruling within one year of the date of loss of u s citizenship for the secretary’s determination as to whether such loss had for one of its principal purposes the avoidance of u s taxes see sec_877 sec_2107 and sec_2501 under notice_98_34 1998_2_cb_29 modifying notice_97_19 1997_1_cb_394 a former long-term_resident whose net_worth or average tax_liability exceeds the applicable thresholds will not be presumed to have a principal purpose of tax_avoidance if that former resident is described within certain categories and submits a complete and good_faith request for a ruling as to whether such loss had for one of its principal purposes the avoidance of u s taxes notice_98_34 requires that certain information be submitted with a request for a ruling that an individual’s expatriation did not have for one of its principal purposes the avoidance of u s taxes a submitted all the information required by notice_98_34 including any additional information requested by the service after review of the submission a is eligible to request a ruling pursuant to notice_98_34 because she has become a resident fully liable to income_tax in the country in which she was born a submitted her request within one year of expatriation based solely on the information submitted and the representations made we conclude that a has made a complete and good_faith submission in accordance with sec_877 and notice_98_34 therefore a will not be presumed under sec_877 to have as one of her principal purposes for expatriating the avoidance of u s taxes it is further concluded that a will not be treated under sec_877 as having as one of her principal purposes of expatriating the avoidance of u s taxes except as expressly provided herein no opinion is expressed or implied concerning the tax consequences of any aspect of any transaction or item discussed or referenced in this letter in addition no opinion is expressed as to a’s u s tax_liability for taxable periods prior to her loss of permanent residence status or for taxable periods after her loss of permanent residence status under sections of the code other than sec_877 sec_2107 and sec_2501 plr-124645-01 page a copy of this letter must be attached to a’s u s income_tax return for the year in which a obtained the ruling 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 will be sent to a’s representative sincerely yours w edward williams senior technical reviewer branch office of the associate chief_counsel international


t c summary opinion united_states tax_court paul and lucia p deltoro petitioners v commissioner of internal revenue respondent docket no 6475-09s filed date paul and lucia p deltoro pro sese lesley hale for respondent armen special_trial_judge this case was heard pursuant to the provisions of sec_7463 of the internal_revenue_code in effect when the petition was filed pursuant to sec_7463 the decision to be entered is not reviewable by any unless otherwise indicated all subsequent section references are to the internal_revenue_code in effect for the year in issue and all rule references are to the tax_court rules_of_practice and procedure other court and this opinion shall not be treated as precedent for any other case respondent determined a deficiency in petitioners’ federal_income_tax of dollar_figure and an addition_to_tax of dollar_figure under sec_6651 for failure to timely file a tax_return after respondent’s concessions the issues for decision are whether petitioners are entitled to a deduction for travel_expenses under sec_162 and if not whether petitioners are liable for the addition_to_tax under sec_6651 for failure to timely file a tax_return the resolution of the first issue turns on whether petitioner paul deltoro’s employment in the san francisco bay area was temporary versus indefinite background some of the facts have been stipulated and they are so found we incorporate by reference the parties’ stipulation of facts supplemental stipulation of facts and accompanying exhibits all dollar amounts are rounded to the nearest dollar respondent concedes that petitioners are entitled to a deduction for union dues of dollar_figure and a deduction for work boots and supplies of dollar_figure petitioners resided in the state of california when the petition was filed all references to petitioner in the singular are to petitioner paul deltoro by profession petitioner is and has been for some years a pipefitter as a pipefitter petitioner is a member of the united association of journeymen and apprentices of the plumbing and pipe fitting industry of the united_states and canada ua in petitioner became a member of ua local in bakersfield california and he was a member of that local for most of his career specifically including a pipefitter also known as a steamfitter is a tradesman who lays out assembles fabricates maintains and repairs mechanical piping systems http en wikipedia org wiki pipefitter because such piping systems typically operate under high pressure metals such as carbon steel stainless steel and other alloy metals are required and the pipefitter must fuse together pipes made of such metals through precise cutting threading grooving bending and welding id the ua is a multicraft union whose big_number members are engaged in the fabrication installation and servicing of various piping systems throughout the united_states and canada http www ua org in petitioner transferred his membership from ua local to ua local and since that time has remained a member of ua local the business office of ua local is located in concord california which city is located in contra costa county and proximate to pittsburg and martinez which are also located in contra costa county that county is part of the east bay area see infra note by pipefitting work in bakersfield had become scarce petitioner learned that opportunities in pipefitting abounded in the san francisco bay area the bay area petitioner seized the opportunity and headed to the bay area to look for work this put him on travel status with ua local in bakersfield petitioner is exceptionally skilled as a pipefitter having a specialty in instrument and process controls he was and remains willing to work in refineries these characteristics made him highly desirable to contractors in the bay area in late petitioner was offered an opportunity to work for performance mechanical inc pmi of pittsburg california on a project at a refinery in the east bay this first project with pmi lasted into date after which petitioner was offered a position by the same foreman for pmi at a different refinery in the east bay upon completion of a project union members usually sign the out-of-work book at the business office of their local union and wait to be called for another project petitioner however when union members are on travel status their names are removed from the out-of-work book at the business office of their local union thereby preventing them from being called by their local union for assignments in its geographical territory the east bay is a region of the san francisco bay area and comprises both alameda and contra costa counties it lies on the eastern shores of the san francisco and san pablo bays cities located in the east bay include oakland berkeley pittsburg richmond and martinez http en wikipedia org wiki east bay_ san_francisco_bay_area did not typically return to bakersfield to sign the out-of-work book but waited for a call directly from the pmi foreman for an assignment to a new project in the east bay throughout petitioner continued to work on various projects for pmi at three different refineries in the east baydollar_figure all of petitioner’s paychecks for were issued by pmi petitioner’s calendar and paystubs indicate that petitioner did not work on approximately weekdays during the year not including holidays during the month of march petitioner did not work on consecutive days but was able to maintain a hour workweek by working saturdays throughout the month a practice that his calendar demonstrates was uncommon in july petitioner was off for consecutive days however petitioner was not off due to the end of a project as he worked the same job preceding and following the days off after and through the time of trial petitioner has worked mostly on projects for although a union pipefitter was typically offered an assignment based on coming to the top of the out-of-work book ie becoming first on the list an exception was permitted if a particular specialty such as instrument and process controls was involved in addition local union rules permitted a name call whereby a contractor wishing to retain a particular pipefitter was entitled to call so many individuals for a particular job by name because of his in-demand specialty his exceptional skill and his strong work ethic when petitioner signed the out-of-work book he usually obtained his assignments by name call at trial petitioner explained that in the east bay there are approximately five refineries within a 15-mile spread pmi with a few intervening projects with other contractors in the bay area at some point in petitioner signed the out-of-work book at the business office of the local union in bakersfield but after month of not being able to find work he returned to work for pmi in the east bay in work became available in the bakersfield area but petitioner did not return to bakersfield at that timedollar_figure in addition although petitioner’s preference would have been to work in bakersfield the rate of pay in the bay area was the highest in the state thereby helping to offset some of the living_expenses that you have working away from your home for many years specifically including and all years thereafter petitioners have resided in bakersfield approximately hours south of the bay area at the beginning of the work week petitioner commuted by train or car from bakersfield to the east bay and made the return trip at the end of the work week during the work week petitioner stayed in the east bay at an apartment that he rented on a month-to-month basis petitioner incurred expenses for transportation between bakersfield and the east bay the apartment rental in the east bay and meals while in the east bay as noted earlier in petitioner transferred his membership from ua local in bakersfield to ua local in concord contra costa county petitioners’ federal_income_tax return was dated and received by the internal_revenue_service field_office in bakersfield california on that same date on their return petitioners reported income of dollar_figure of which dollar_figure represented wages received by petitioner from pmi petitioners claimed a deduction for unreimbursed employee business_expenses of dollar_figure reported on a form_2106 employee business_expenses the unreimbursed employee business_expenses included amounts for union dues work boots and supplies and travel_expenses in the notice_of_deficiency respondent disallowed most of the deduction claimed by petitioners for unreimbursed employee business_expenses on their form_2106 respondent also determined that petitioners are liable for an addition_to_tax for failure to timely file a tax_return a sec_162 travel_expenses discussion as a general_rule personal living_expenses are nondeductible sec_262 sec_1_162-2 sec_1_262-1 income_tax regs however sec_162 allows a taxpayer to deduct ordinary and necessary travel_expenses including meals_and_lodging paid_or_incurred while away from home in pursuit of a trade_or_business 326_us_465 the reference to home in sec_162 means the taxpayer’s tax_home dollar_figure 74_tc_578 67_tc_1 49_tc_557 as a general_rule a taxpayer’s principal place of employment is his tax_home not where his personal_residence is located if different from his principal place of employment mitchell v commissioner supra pincite kroll v commissioner supra pincite if a taxpayer for personal reasons chooses to reside in a different location than that of his principal place of employment his residence is not recognized as his home for tax purposes commissioner v flowers supra 54_tc_734 affd 444_f2d_508 5th cir an exception to the general_rule exists where a taxpayer accepts temporary rather than indefinite employment away from his personal_residence in that case the taxpayer’s personal_residence may be his tax_home 358_us_59 employment is temporary if its termination can be foreseen within a fixed or reasonably short_period of time mitchell v the vocational tax_home concept was first construed by this court in 5_bta_1181 and has been steadfastly upheld by this court see eg 86_tc_589 85_tc_798 67_tc_1 49_tc_557 commissioner supra pincite 54_tc_355 affd per curiam 438_f2d_1216 6th cir employment that merely lacks permanence is indefinite unless termination is foreseeable within a short_period of time 66_tc_467 kroll v commissioner supra pincite sec_162 further provides that the taxpayer shall not be treated as being temporarily away from home during any period of employment if such period exceed sec_1 year this court has held that a taxpayer who is kept away from his family residence because of his work at a series of temporary jobs in disparate geographical areas is considered away from home while so employed 54_tc_663 however a taxpayer who works in the same area and no other for a protracted length of time is not considered away from home curtis v commissioner tcmemo_1970_299 taxpayer worked as a pipefitter on a variety of different jobs throughout the year but all jobs were within miles of dolton illinois whereas taxpayer claimed his tax_home was kerrville texas affd 449_f2d_225 5th cir petitioner contends that his employment in the bay area was temporary and therefore that his tax_home was in bakersfield as that was where he maintained a home and resided while he was not living and working in the bay area respondent argues that petitioner’s employment in the bay area was indefinite and that his tax_home was not his residence in bakersfield but rather the bay area which was the vicinity of his employment for the following reasons we agree with respondent in petitioner headed to the bay area after learning about an abundance of work opportunities for pipefitters in that region petitioner began working on a project for pmi in late that first position with pmi lasted into early after which time petitioner was consistently offered positions on projects with pmi in the bay area these projects lasted throughout and petitioner has continued to work on projects for pmi in the bay area through the time of trial when a project with pmi was finished petitioner would not typically sign the out-of-work book at the business office of the local union in concord but rather would wait for a call from pmi for an assignment to a new project in the bay area although petitioner stated that he worked on a few intervening projects with other contractors in years after those projects were also in the bay area petitioner stated that his preference would have been to work in bakersfield however there were no opportunities there in petitioner’s specialty and even when an opportunity for work in general pipefitting arose petitioner did not return to bakersfield in addition when petitioner was on travel status away from the local union in bakersfield his name was removed from the out-of-work book such that he could not be selected for work there while traveling petitioner stated that he signed the out-of-work book at the business office of the local union in bakersfield at some point in however after a month of not being able to secure work he headed back to the east bay to again work for pmidollar_figure finally petitioner stated that the rate of pay in the bay area was the highest in the state and that it was worth his while to travel to the east bay indeed petitioner testified that if i had the chance to work you know in modesto as opposed to the bay area i would probably take the bay area because the dollar difference would help pay some of those expenses for the foregoing reasons we find that petitioner’s employment in the bay area was indefinite and not temporary it was personal choice and not business exigencies that dictated petitioner’s decision to maintain his residence in bakersfield and incur expenses related to his employment in the bay area see commissioner v flowers u s pincite petitioner’s commitment to the bay area and to the east bay in particular is demonstrated by the fact that in he transferred his membership from the ua local in bakersfield to the ua local in contra costa county in conclusion because petitioner was not away from home within the meaning of sec_162 he is not entitled to a deduction for expenses_incurred in what was essentially a long- distance commute to work accordingly we sustain respondent’s determination on this issue b sec_6651 addition_to_tax sec_6651 imposes an addition_to_tax for failure_to_file a return by its due_date the addition equal sec_5 percent for each month or fraction thereof that the return is late not to exceed percent in the absence of an extension the last date for petitioners to have timely filed their federal_income_tax return for was monday date see sec_6072 respondent has proven and has therefore discharged his burden of production under sec_7491 that petitioners’ federal_income_tax return was not received and filed until date more than years after its due_date a failure_to_file a tax_return on the date prescribed leads to a mandatory penalty unless the taxpayer shows that such failure was due to reasonable_cause and not due to willful neglect 114_f3d_366 2d cir affg tcmemo_1995_547 a showing of reasonable_cause requires a taxpayer to show that he or she exercised ordinary business care and prudence but was nevertheless unable to file the return within the prescribed time 469_us_241 sec_301_6651-1 proced admin regs petitioners have not offered any persuasive evidence to establish that the late filing of their return was due to reasonable_cause and not due to willful neglect accordingly we hold that petitioners are liable for the addition_to_tax under sec_6651 conclusion we have considered all of the other arguments made by petitioners and to the extent that we have not specifically addressed those arguments we conclude that they do not support a result contrary to that reached herein to reflect our disposition of the disputed issues as well as respondent’s concessions decision will be entered under rule


tax_exempt_and_government_entities_division department of the treasury internal_revenue_service washington d c uniform issue list oct 5e te ra tp legend taxpayera companyc companyd ira x ira y ira z amount e amount f amount g amount h amount dear this is in response to your request dated date on behaif of the estate of taxpayer a submitted by your authorized representative for a ruling to waive the day rollover requirement contained in sec_408 of the internal_revenue_code the code correspondence dated date supplemented the request page your representative has submitted the following facts and representations taxpayer a requested that amount e and amount f be transferred on may from two individual_retirement_accounts iras x and y respectively in direct trustee-to- trustee transfers to an ira maintained at company d on may be company c the trustee of iras x and y made the trustee-to-trustee transfers to company d which deposited the funds into an ira account set up in the name of and for the benefit of taxpayer a ira z during the preparation of taxpayer a's income_tax return taxpayer a noticed that based on the form 1099-r issued by company c the transfers were not reported by company c as trustee-to-trustee transfers but rather as a fully taxable_distribution of amount g amount e plus amount f amount was withheld for federal income taxes the net amount amount h was received by company d from company c and at no time did taxpayer a have control of any funds as the ira x deposited into ira z and ira y amounts were either transferred by trustee-to-trustee transfers to ira z or sent directly to the internal_revenue_service as payment of federal_income_tax prior to her death taxpayer a had contacted company d on more than one occasion in attempts to reverse company c’s error and have amount i contributed into her ira z however taxpayer a while continuing her attempts to correct the reporting error passed away on august prior to a final_determination as to the facts surrounding the error in making the trustee-to-trustee transfers ee you as personal representative of the estate of taxpayer a deposited in october into ira z amount i the amount of the federal_income_tax withheld when ira x and ira y amounts were placed in ira z in order to complete the transfer of amount g to said ira z ina letter dated october ine to taxpayer a which was after the death of taxpayer a company d indicated that the transaction was processed incorrectly but that company c was unable to correct the error because more than one year had passed since the transaction documentation submitted as part of this request confirms the intent of taxpayer a to complete direct ira trustee-to-trustee transfers totaling amount g into ira z specifically a form prepared by company d and signed by taxpayer a on or about may em indicated that taxpayer a had established an ira with company d and that company d agreed to accept a trustee to trustee transfer of funds from taxpayer a based on the facts and representations you request that the internal_revenue_service waive the day rollover requirement with respect to your contribution of amount into ira z because the failure to waive such requirement would be against equity or good conscience 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 page 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 60th 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 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 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 you as a personal representative of the estate of individual a properly rolled over amount into ira z with respect to the resolution of said issue we note that individual a had established ira z prior to her death and had the intent to transfer by direct trustee-to-trustee transfers all amounts standing in iras x and y totaling amount g into such ira however because of an error on the part of company c the requested transfers were treated as taxable_distributions as a result company c withheld amount i for federal income taxes and only amount h was transferred to ira z the facts indicate that taxpayer a had the intent to transfer amounts e and f totaling amount g into ira z an ira that she established prior to her death furthermore page amount h had been placed ira z and the difference between amount g and amount h amount would also have been placed in ira z but for an error on the part of company c which was beyond the control of taxpayer a furthermore taxpayer a died in the process of but prior to rectifying the error made by company c with respect to her intended trustee-to-trustee transfers based on the above facts it is our conclusion that you as personal representative of the estate of taxpayer a properly rolled over amount to ira z accordingly pursuant to sec_408 of the code the service hereby waives the 60-day rollover requirement with respect to the contribution of amount to ira z provided all other requirements of sec_408 of the code except the 60-day requirement were met with respect to such contribution the amount deposited into ira z during october em totaling amount is considered a rollover_contribution within the meaning of sec_408 of the code please note that ira z will be treated as having a designated_beneficiary within the meaning of and for purposes of code sec_401 only if taxpayer a had designated one or more individuals eligible to be treated as such prior to her death you as personal representative of taxpayer a's estate cannot designate a code sec_401 beneficiary of ira z 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 if you wish to inquire about this ruling please contact sri arr ta ties ip peeees at _ please address all correspondence to se t ep ra t3 sincerely yours france sec_3 a employee plarts technical group enclosures deleted copy of ruling letter notice of intention to disclose


department of the treasury internal_revenue_service washington d c commissioner uic jun eh he tf legend taxpayer a bank u city e state f ira x company t amount amount date date date date date date 6_month dear ms this is in response to the correspondence dated letter as supplemented by in which you request an extension of the page day rollover period found in sec_408 of the internal_revenue_code code applicable to individual_retirement_accounts iras your request is based on the following facts and representations hereinafter date on located in city e state f and made a contribution in the amount of amount with respect to calendar year_ certificate of deposit that maturedon_ -s-- -_-s date as a result of the contribution ira x held a taxpayer a opened ira x with bank u date _ on taxpayer a advised bank u in writing that she wished to receive the proceeds from her ira x in order to roll over said proceeds into another ira she maintained with company t although bank u maintains it mailed a check in the amount of amount amount plus earnings to taxpayer aduring--s month correspondence to the internal_revenue_service service that said check was never received in this regard documentation attached to this ruling_request includes a traditional_ira distribution form’ completed by an agent of bank u in response to taxpayer a’s date 3__ letter which lists the ira x owner as someone with a name other than taxpayer a’s and provides no mailing address - --s taxpayer a has asserted in written had never date bank u issued a ____ which date lies _-s taxpayer a received a form 1099-r _ taxpayer a has asserted in writing to the onorabout --_ date4 issued by bank u showing a distribution from ira x in the amount of amount in response to a subsequent inquiry from taxpayer a bank u noted that its records indicated the check sent to taxpayer a during month 1__ been cashed onor about _ replacement check in the amount of amount to taxpayer a said check was then deposited by taxpayer a in a non-tax preferred non-ira account where it remains taxpayer a’s ruling requestisdated -s- date within days of date5 service that she believed the day ira rollover period began the date in month that bank u maintains it initially mailed a check to taxpayer a as aresult since date5 -_ occurred beyond the 60-day period measured from the last day in month proceeds of the date __- service permitting her to do so check until she had received a letter_ruling from the __ she was not authorized to roll over the taxpayer awas bornin page 53'7040 based on the facts and representations you request that the internal_revenue_service waive the 60-day rollover requirement found in sec_408 of the internal_revenue_code code with respect to the distribution of amount from ira x 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 - the entire amount received including money and any other_property is i paid into 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 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 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 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 a similar 60-day rollover period for partial rollovers code sec_408 provides in general that rules similar to the page rules of sec_401 shall apply to the distribution of the entire_interest of an individual for whose benefit the trust is maintained sec_408 of the code provides that the secretary may waive the 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 i r b 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 she -__ which failure stems at least partly from bank u’s the information presented by taxpayer a demonstrates that the failure of taxpayer a to make a rollover_contribution within days of receiving amount from ira x was primarily due to her not receiving the check mailed by bank u to her during month1 records listing an individual as the owner of ira x who did not share her name and from bank u’s not listing taxpayer a’s correct address on the ira x distribution form when taxpayer a received a replacement checkin - did not contribute said check to another ira because she believed that the day rollover period was measured from the date bank u mailed her the first check which occurred during month1__ unspent therefore pursuant to code sec_408 the service hereby waives the 60-day rollover requirement with respect to the withdrawal of amount from ira x 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 no greater than amount to another provided all other 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 said replacement check remains __ page 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 if you wish to inquire about this ruling please contact - esquire d phone-not a toll-free number or pat _ please address any correspondence to se t ep ra t3 sincerely yours ann sod manager employee_plans technical group enclosures deleted copy of letter_ruling notice of intention to disclose


department of the treasury internal_revenue_service washington d c government entities division sep number release date uil t ep ra t a2 re plan former parent this letter constitutes notice that with respect to the above-named defined benefit pension_plan sec_401 of the internal_revenue_code code and section i of the employee_retirement_income_security_act_of_1974 as amended erisa do not apply to the proposed amendment to the plan as described below sec_412 of the code and sec_304 of erisa do not apply to the proposed amendment to the plan as described below sec_401 of the code provides that a plan is not a qualified_plan if an amendment is adopted while the employer is a debtor in a case under title united_states_code or similar federal or state law and such amendment increases liabilities of the plan by reason of i any increase in benefits ii any change in the accrual_of_benefits or iii any change in the rate at which benefits become nonforfeitable under the plan with respect to employees of the debtor and such amendment is effective prior to the effective date of such employer's plan_of_reorganization sec_401 of the code provides that sec_401 will not apply to any plan amendment if i the plan were such amendment to take effect would have a funded_current_liability_percentage of percent or more ii the secretary_of_the_treasury determines that such amendment is reasonable and provides for only de_minimis increases in the liabilities of the plan with respect to employees of the debtor iii such amendment only repeals an amendment described in sub sec_412 or iv such amendment is required as a condition of qualification under this part sec_412 of the code provides that if a waiver of the minimum_funding_standard under sec_412 of the code is in effect with respect to a plan that is amended to increase the liabilities of the plan by reason of any increase in benefits any change in the accrual_of_benefits or any change in the rate at which benefits become nonforfeitable such waiver shall not apply to any plan_year ending on or after the date on which such amendment is adopted sec_412 of the code provides that sec_412 of the code shall not apply to any plan amendment which the secretary of labor determines to be reasonable and which provides only de_minimis increases in the liabilities of the plan reorganization plan no which became effective date transferred the authority indicated in sec_412 from the secretary of labor to the secretary of treasury section i of erisa prohibits a plan amendment that increases the liabilities of a plan maintained by an employer that is a debtor under title of the united_states_code or similar federal or state law by reason of a any increase in benefits b any change in the accrual_of_benefits or c any change in the rate at which benefits become nonforfeitable under the plan with respect to employees of the debtor and such amendment is effective prior to the effective date of such employer's plan_of_reorganization section i of erisa provides that section i shall not apply to any plan amendment that a the secretary_of_the_treasury determines to be reasonable and that provides for only de_minimis increases in the liabilities of the plan with respect to employees of the debtor b such amendment only repeals an amendment described in sec_302 c is required as a condition of qualification under the code or d was adopted prior to or pursuant to a collective bargaining agreement entered into prior to the date on which the employer became a debtor in a case under title of the united_states_code or similar federal or state law section i of erisa provides that section i only applies to plans other than multiemployer plans for which the funded_current_liability_percentage is less than percent after taking into account the effect of the amendment sec_304 of erisa provides that if a waiver of the minimum_funding_standard under sec_303 of erisa is in effect with respect to a plan that is amended to increase the liabilities of the plan by reason of any increase in benefits any change in the accrual_of_benefits or any change in the rate at which benefits become nonforfeitable such waiver shall not apply to any plan_year ending on or after the date on which such amendment is adopted sec_304 of erisa provides that sec_304 of erisa shall not apply to any plan amendment which the secretary of labor determines to be reasonable and which provides only de_minimis increases in the liabilities of the plan the company is a u s -based global supplier of vehicle electronics transportation components integrated systems and modules and other electronic technology with a network of manufacturing sites technical centers sales offices and joint ventures in every major region of the world the company supplies products to automotive original equipment manufacturers worldwide and its customer base includes customers in the communications computer consumer electronics energy and medical devices industries the company filed a voluntary petition under chapter of the u s in october bankruptcy code the company continues to operate its business as debtor-in- possession in a ruling letter dated date the plan received a conditional waiver of the minimum_funding_standard for the plan_year ending september ruling letter dated date this conditional waiver was modified at the company’s request ina the company has announced its intention to cease benefit accruals for most participants under the plan before or soon after its emergence from chapter bankruptcy protection after the cessation of benefit accruals participants in the plan will continue to earn eligibility and vesting service credits until termination of employment with the company prior to or soon after its emergence from chapter bankruptcy protection and prior to or soon after benefit accruals to the plan cease the company may sell or otherwise divest certain non-core business units and certain of its salaried employees may return to employment at the former parent it is anticipated that such divestitures or returns to the former parent will involve the transfer of current participants in the plan to new employers absent an amendment to the plan such a transfer would break the service of the transferred participants and prevent them from continuing to earn eligibility and vesting service credits in the plan this would result in vested participants in the plan being treated as deferred vested unable to earn eligibility and vesting service credits under the plan consequently the company proposes to amend the plan to recognize service performed by former participants transferred to the former parent or to another successor employer as part of the divestiture of a business unit of the company for purposes of eligibility and vesting the proposed amendment would only apply to employees who were employed by the company and covered by the plan immediately prior to the sale dates post-sale service credits would be included with pre-sale service credits to determine eligibility for certain benefits that are provided by the current provisions of the plans under the proposed amendment post-sale service for participants who become employees of buyers will be treated exactly the same as post-freeze service for participants who remain employed by the company after the amendment described above the plan will have a current_liability percentage that is less than percent and the company will still be a debtor in possession in a case under title of the united_states_code the amendment will be adopted prior to the company’s date of reorganization to a provide the buyers of the non-core business units with a viable workforce and b to administer the plan in accordance with past practice these reasons in and of themselves are not sufficient to consider the amendment reasonable however the company has a unique history with its former parent prior to the company’s spin-off from its former parent the former parent's plans were typically amended to continue to recognize post-divestiture service with the buyer for purposes of eligibility as a result the company’s employees have longstanding expectations regarding their treatment in the event that they are transferred to a buyer of their operation consequently the amendment would be consistent with the company’s long-term established business practice and would provide an economic benefit to the company by enabling it to consummate divestiture of non-core businesses hence the amendment is reasonable according to information provided by the enrolled_actuary for the plan the proposed amendment to the plan will have a negligible impact on the total annual cost to the company and any increases in liabilities or costs to the plan or the minimum required contributions to the plan will be virtually nil accordingly the amendment is de_minimis hence because the proposed amendment to the plan is reasonable and provides for only de_minimis increases in plan liabilities sec_401 of the code and section i of erisa do not apply to the proposed amendment to the plan sec_412 of code and sec_304 of the erisa do not apply to the proposed amendment to the plan this ruling considers only the application of sec_401 and sec_412 of the code and sections i and b of erisa to the amendment described above and does not consider any other issues that may arise in connection with the plan or the proposed amendment 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 we have sent a copy of this letter to the manager and to your authorized representative pursuant to a power_of_attorney on file in this office to the manager if you require further assistance in this matter please contact sincerely yours gold b james e holland jr manager employee_plans technical


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 b09 plr-123827-04 date july ------------------------ -------------------------- ------------------------ ------------------------------------------------- --------- --------------------------- ------- ----------- ------------------- ------- legend wife date husband trust x date year y date year accountant ------------------------------ dear ---- extension of time under sec_2642 of the internal_revenue_code and sec_301_9100-3 of the procedure and administration regulations to make an allocation of wife’s generation-skipping_transfer gst_exemption husband and wife collectively grantors created trust for the benefit of their descendants article iii of the trust agreement provides that during the grantors’ lifetimes the trustees in their sole discretion may distribute trust net_income and or principal to or on behalf of one or more of the grantors’ descendants for their health education support or maintenance after taking into consideration all other income or property of the beneficiary upon the death of the last to die of the grantors the remaining trust principal is to be allocated to the grantors’ then living descendants per stirpes pursuant to the provisions of a_trust established for each separate descendant the facts and representations submitted are summarized as follows on date this is in response to your letter dated date requesting an husband transferred dollar_figurex in cash to trust on date date is in year plr-123827-04 husband and wife each filed a form_709 united_states gift and generation-skipping_transfer_tax return gift_tax_return for year reporting the transfer to trust on each return husband and wife elected to split_gifts under sec_2513 and allocated gst_exemption to the transfer husband and wife transferred dollar_figurey in cash to trust on date date is in year wife has requested an extension of time to allocate gst_exemption to her sec_2513 provides that paragraph shall apply only if both spouses sec_2513 provides that a gift made by one spouse to any person other wife notified accountant of the year transfer to trust and relied upon accountant to prepare her year gift_tax_return accountant inadvertently failed to file a gift_tax_return for year portion of the year transfer to trust than the other spouse shall for the purposes of this chapter be considered as made one-half by him and one-half by his spouse but only if at the time of the gift each spouse is a citizen or resident_of_the_united_states have signified under the regulations provided for in subsection b their consent to the application of paragraph in the case of all such gifts made during the calendar_year by either while married to the other sec_25_2513-2 of the gift_tax regulations provides that consent to the application of the provisions of sec_2513 with respect to a calendar_period shall in order to be effective be signified by both spouses if both spouses file gift_tax returns within the time for signifying consent it is sufficient if the consent of each spouse is signified on his own return skipping transfer is defined under sec_2611 as a taxable_distribution a taxable_termination and a direct_skip every individual shall be allowed a gst_exemption of dollar_figure adjusted for inflation under sec_2631 which may be allocated by such individual or his executor to any property with respect to which such individual is the transferor exemption under sec_2631 may be made at any time on or before the date prescribed for filing the estate_tax_return for such individual’s estate determined with regard to extensions regardless of whether such a return is required to be filed sec_2631 provides that for purposes of determining the inclusion_ratio sec_2601 imposes a tax on every generation-skipping_transfer a generation- sec_2632 provides that any allocation by an individual of his or her gst sec_2642 provides that in determining whether to grant relief under sec_2642 provides generally that the secretary shall by regulation plr-123827-04 sec_2642 provides that except as provided in sec_2642 if the allocation of the gst_exemption to any transfers of property is made on a gift_tax_return filed on or before the date prescribed by sec_6075 for such transfer or is deemed to be made under sec_2632 or c the value of such property for purposes of sec_2642 shall be its value as finally determined for purposes of chapter within the meaning of sec_2001 or in the case of an allocation deemed to have been made at the close of an estate_tax_inclusion_period on and after the close of such estate_tax_inclusion_period prescribe such circumstances and procedures under which extensions of time will be granted to make an allocation of gst_exemption described in sec_2642 or and an election under sec_2632 or c such regulations shall include procedures for requesting comparable relief with respect to transfers made before the date of the enactment of this paragraph this paragraph the secretary shall take into account all relevant circumstances including evidence of intent contained in the trust instrument or instrument of transfer and such other factors as the secretary deems relevant for purposes of determining whether to grant relief under this paragraph the time for making the allocation or election shall be treated as if not expressly prescribed by statute for allocating the gst_exemption to lifetime transfers and transfers at death the time for electing out of the automatic allocation rules and the time for electing to treat any trust as a gst_trust are to be treated as if not expressly prescribed by statute the notice further provides that taxpayers may seek an extension of time to make an allocation described in sec_2642 or b or an election described in sec_2632 or c under the provisions of sec_301_9100-3 sec_301_9100-1 provides that the commissioner has discretion to grant a reasonable extension of time under the rules set forth in sec_301_9100-2 and sec_301_9100-3 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 internal_revenue_code except in subtitles e g h and i for regulatory elections that do not meet the requirements of sec_301_9100-2 must be made under the rules of sec_301_9100-3 date is prescribed by a notice published in the internal_revenue_bulletin in accordance with sec_2642 and notice_2001_50 taxpayers may seek an extension of time to make an election described in sec_2642 or b or an election described in sec_2632 or c under the provisions of sec_301_9100-3 sec_301_9100-3 provides that in general requests for extensions of time notice_2001_50 2001_2_cb_189 provides that under sec_2642 the time under sec_301_9100-1 a regulatory election includes an election whose due requests for relief under sec_301_9100-3 will be granted when the taxpayer sec_301_9100-3 provides that a taxpayer is deemed to have acted plr-123827-04 provides the evidence to establish to the satisfaction of the commissioner that the taxpayer acted reasonably and in good_faith and that granting relief will not prejudice the interests of the government reasonably and in good_faith if the taxpayer reasonably relied on a qualified_tax professional including a tax professional employed by the taxpayer and the tax professional failed to make or to advise the taxpayer to make the election based on the facts submitted and the representations made we conclude that the requirements of sec_301_9100-3 have been satisfied therefore wife is granted an extension of time of days from the date of this letter to file a form_709 for year the form_709 should include a notice of allocation properly allocating wife’s gst_exemption to the year transfer to trust the allocation will be effective as of the date of the transfer and the gift_tax value of the transfer to trust will be used in determining the amount of gst_exemption to be allocated to trust the inclusion_ratio for trust will be determined under sec_2642 and sec_2642 a copy of this letter should be attached to the supplemental form_709 and filed with the internal_revenue_service center cincinnati ohio a copy is included for this purpose concerning the federal tax consequences of any aspect of any transaction or item discussed or referenced in this letter representations submitted by the taxpayer and accompanied by a penalty of perjury statement executed by an appropriate party while this office has not verified any of the material submitted in support of the request for rulings it is subject_to verification on examination being sent to the taxpayer’s representative pursuant to the power_of_attorney on file with this office a copy of this letter is except as expressly provided herein no opinion is expressed or implied the rulings contained in this letter are based upon information and plr-123827-04 provides that it may not be used or cited as precedent this ruling is directed only to the taxpayer requesting it sec_6110 sincerely heather c maloy heather c maloy associate chief_counsel passthroughs and special industries enclosures cc copy of this letter for sec_6110 purposes copy of this letter


rebels j sage o rr y ie ue uae en department of the treasuef’ internal swe service washington d c lo cae revers tax_exempt_and_government_entities_division uniform issue list aug se t er ra tz xkkkkkkkkkkkk xxxxxxxxxxkxx xkxxkxkxkxkxkxkkxkkx xxxxxkxkxxkxkxkkx legend taxpayer a xxxxxxxxxxxxxx taxpayer bo xxxxxxxxxxxxxkx amount c xxxxxxxxxxxxxkx date xxxkxkkxxkxkxkxkkx date xxxxxxxxxxxxkkx date xxxxxxxxxxkkxxx date xxxxxxkxxxkkkx ira x xxxxxxxxxxxxxxk xxxxxxxxkxkxkkxk xxxkxxkxkxkxkxkxkxkkxk dear xxxxxxxxxxxxxx this is in response to your request dated date submitted on behalf of the estate of taxpayer a by your authorized representative in which you as the personal representative of the estate of taxpayer a request 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 xxkxxkkxkaxakakkk i o n taxpayer a age was the owner of ira x a savings_incentive_match_plan for employees simple_ira taxpayer a received a distribution totaling amount c from ira x taxpayer a died on date taxpayer b asserts that the failure to accomplish a rollover of amount c within the 60-day period prescribed by sec_408 of the code was due to taxpayer a’s death taxpayer b represents that pursuant to the termination of ira x on date taxpayer a received three checks from ira x totaling amount c taxpayer a intended to roll over amount c into a new traditional_ira account with a different custodian but died on date before he was able to complete the rollover on date taxpayer b discovered the uncashed checks on taxpayer a’s desk and attempted to establish an ira prior to date the expiration of the 60-day rollover period but no financial_institution would accept them taxpayer b has submitted a certified copy of the will naming taxpayer b as personal representative of taxpayer a’s estate because taxpayer a was unable to complete the rollover due to his death taxpayer b as surviving_spouse and sole beneficiary has requested a waiver of the 60-day rollover requirement to rollover the proceeds from ira x into an ira account set up and maintained in her name as spousal beneficiary documentation has been submitted that reveals that taxpayer a intended to roll over amount c within days of date the date of distribution amount c has not been used for any other purpose based on the facts and representations you request a ruling that the internal_revenue_service waive the 60-day rollover requirement with respect to the distribution of amount c from ira x 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 lkrxkrxxhhk i 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 that the rollover provisions of sec_408 do not apply to any amount required to be distributed under sec_408 sec_408i 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 sec_408 of the code provides that the secretary may waive the 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 of the code 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 preamble to the final income_tax regulations under sec_401 of the code provides in relevant part that a surviving_spouse may elect to treat an ira of xxxxkxkxkkxaxaxkkk his her deceased spouse as his her own if the surviving_spouse is the sole beneficiary of the ira with an unlimited right to withdraw from the ira a surviving_spouse may not elect to treat an ira as his her own if a_trust is the beneficiary of the ira however a surviving_spouse maybe eligible to roll over a distribution from an ira of a decedent if the spouse actually receives the distribution regardless of whether the spouse is the sole beneficiary of the ira see preamble pincite federal_register date the information presented and the documentation you submitted is consistent with your assertion that the failure to accomplish a timely rollover was due to the death of taxpayer a therefore pursuant to sec_408 of the code the service hereby waives the 60-day rollover requirement with respect to the distribution of amount c from ira x taxpayer b is granted a period of days from the issuance of this ruling letter to contribute amount c into a rollover ira provided all other requirements of sec_408 of the code except the 60-day requirement are met with respect to such contribution amount c will be considered a rollover_contribution within the meaning of sec_408 of the code the service notes that the rollover ira into which amount c will be contributed will not have a designated_beneficiary as that term is defined in code sec_401 thus the code sec_401 distribution period with respect to the rollover ira will be that applicable to an ira owner who had reached his required_beginning_date and died without designating a beneficiary of his ira 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_61 k no opinion is expressed as to the tax treatment of the transaction described of the code provides that it may not be used or cited as precedent xxxxxxxkxxkkkx n c if you wish to inquire about this ruling please contact xxxxxxxxxkkxx id xx- xxxxxx at xxx xxx-xxxx please address all correspondence to se t ep ra t2 sincerely - yy q of vener lh leh a donzel employee_plans technical group littlejohn manager f enclosures deleted copy of ruling letter notice of intention to disclose


internal_revenue_service department of the treasury number release date index number washington dc person to contact telephone number refer reply to cc psi plr-129864-02 date date legend corporation date date date date date date trust a b shareholders plr-129864-02 m n o dear this letter responds to your letter dated date and subsequent correspondence written on behalf of corporation requesting inadvertent termination relief under sec_1362 of the internal_revenue_code facts according to the information submitted corporation was organized in date and elected to be treated as an s_corporation effective date plr-129864-02 prior to date a and b owned n shares of corporation’s stock as community_property on date a died pursuant to the terms of a’s will a’s estate transferred o shares of corporation’s stock a’s community_property interest to trust on date b is the beneficiary of trust it is represented that trust is a qualified_subchapter_s_trust qsst as defined in sec_1361 due to an oversight b did not make a timely qsst election under sec_1361 thereby terminating corporation’s s_corporation_election on date days after date in date corporation discovered that a qsst election for trust was not made shortly thereafter corporation submitted this private_letter_ruling request corporation represents that the transfer of stock to trust and subsequent failure_to_file the qsst election were not motivated by tax_avoidance or retroactive tax planning it is represented that corporation and its shareholders have treated corporation as an s_corporation since date further corporation represents that since date b has been treated as the owner of the o shares of corporation’s stock that were transferred to trust corporation and its shareholders have agreed to make any adjustments that the commissioner may require consistent with the treatment of corporation as an s_corporation law sec_1361 defines an s_corporation as a small_business_corporation for which an election under sec_1362 is in effect sec_1361 defines a small_business_corporation as a domestic_corporation that is not an ineligible_corporation and that does not a have more than shareholders b have as a shareholder a person other than an estate a_trust described in sec_1361 or an organization described in sec_1361 who is not an individual c have a nonresident_alien as a shareholder and d have more than one class of stock sec_1361 provides that for purposes of sec_1361 a_trust all of which is treated under subpart e of part i of subchapter_j of chapter as owned by an individual who is a citizen or resident_of_the_united_states may be a shareholder of an s_corporation for taxable years beginning on or before date sec_1361 provides that a_trust with respect to stock transferred to it pursuant to the terms of a will but only for the 60-day period beginning on the day on which such stock is transferred to it may be a shareholder of an s_corporation plr-129864-02 sec_1361 states that a qsst with respect to which a beneficiary makes an election under sec_1361 will be treated as a_trust described in sec_1361 and for purposes of sec_678 the qsst's beneficiary will be treated as the owner of that portion of the qsst that consists of stock in an s_corporation to which the election under sec_1361 is made under sec_1361 the beneficiary of a qsst may elect to have sec_1361 apply under sec_1361 this election will be effective up to days and two months before the date of the election under sec_1362 an election under sec_1362 is terminated whenever at any time on or after the first day of the first taxable_year for which the corporation is an s_corporation the corporation ceases to be a small_business_corporation sec_1362 provides that if an election under sec_1362 by any corporation was terminated under sec_1362 or the secretary determines that the termination was inadvertent no later than a reasonable period of time after discovery of the circumstances resulting in the termination steps were taken so that the corporation is a small_business_corporation and the corporation and each person who was a shareholder of the corporation at any time during the period specified pursuant to sec_1362 agrees to make such adjustments consistent with the treatment of the corporation as an s_corporation as may be required by the secretary with respect to the period then notwithstanding the circumstances resulting in the termination such corporation is treated as an s_corporation during the period specified by the secretary conclusion based solely on the facts submitted and representations made we conclude that corporation's s_corporation_election terminated on date under sec_1362 when b failed to make a timely qsst election for trust under sec_1361 we also conclude that the termination of corporation’s s_corporation_election was inadvertent within the meaning of sec_1362 therefore under sec_1362 corporation will be treated as an s_corporation from date and thereafter provided that b files a qsst election for trust with an effective date of date with the appropriate service_center within days of the date of this ruling and that corporation’s s_corporation_election is valid and is not otherwise terminated under sec_1362 a copy of this letter must be attached to the qsst election and is enclosed for this purpose during the period of termination trust will be treated as a_trust described in sec_1361 and b will be treated for purposes of sec_678 as the owner of that portion of trust which consists of corporation stock accordingly the shareholders of plr-129864-02 corporation in determining their respective income_tax liabilities for the period beginning date and thereafter must include their pro_rata share of the separately_stated and non-separately computed items of corporation under sec_1366 make any adjustments to basis under sec_1367 and take into account any distributions made by corporation under sec_1368 if corporation or its shareholders fail to treat themselves as described above this ruling shall be null and void except as specifically set forth above no opinion is expressed concerning the federal tax consequences of the facts described above under any other provision of the code specifically no opinion is expressed on whether corporation is otherwise qualified to be an s_corporation or whether trust is a valid qsst pursuant to the power_of_attorney on file with this office we are sending the original of this letter to you corporation’s authorized representative and a copy of this letter to corporation this ruling is directed only to the taxpayer requesting it sec_6110 provides that it may not be used or cited as precedent sincerely yours s mary beth collins senior technician reviewer branch office of associate chief_counsel passthroughs and special industries enclosures copy of this letter copy for sec_6110 purposes


internal_revenue_service department of the treasury number release date index number washington dc person to contact telephone number refer reply to cc psi - plr-137254-01 date date x a d1 year dear this letter responds to your letter dated date and subsequent correspondence submitted on behalf of x requesting a ruling under sec_1362 of the internal_revenue_code the information submitted states that x was incorporated on d1 in year a as the sole shareholder and president of x represents that x was intended to be an s_corporation beginning year its first taxable_year the minutes of the regular meeting of the directors of x evidences this intent however no form_2553 election by a small_business_corporation was filed with the internal_revenue_service for year x filed a form_1120s u s income_tax return for an s_corporation sec_1362 of the code provides that if -- a an election under sec_1362 is made for any taxable_year after the date prescribed by sec_1362 for making such election for such taxable_year or no such election is made for any taxable_year and b the secretary determines that there was reasonable_cause for the failure to timely make such election the secretary may treat such an election as timely made for such taxable_year based solely on the facts and the representations submitted we conclude that x has established reasonable_cause for failing to make a timely election to be an s_corporation for x's year taxable_year accordingly provided that x makes an election to be an s_corporation by filing a completed form_2553 with the appropriate service_center effective for its year taxable_year within days following the date of this letter then such election will be treated as timely made for x's year taxable_year a copy of this letter should be attached to the form_2553 except as specifically set forth above no opinion is expressed concerning the plr-137254-01 federal tax consequences of the facts described above under any other provision of the code including whether x was or is a small_business_corporation under sec_1361 of the 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 sent to x’s authorized representative sincerely yours matthew lay senior technician reviewer branch office of the associate chief_counsel passthroughs and special industries enclosures copy of this letter copy for sec_6110 purposes