Save a Client $10,000 With New IRS Procedure for Waiving 60-Day Rollover Deadline

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$10,000 Rollover Lessons From the IRS

Clients who miss their 60-day rollover deadline may be tempted to ask the IRS for an exception through a private letter ruling. However, as of 2016, they will have to pay a $10,000 fee with no guarantee of a favorable result. Here’s a look at three defenses that did not work with some tips for keeping clients compliant.

Options for Clients Who Missed the 60-Day Rollover Deadline

Missing the 60-day rollover deadline can subject a client to unwanted taxes and penalties. However, you may be able to preserve the tax deferral through automatic waivers or private letter rulings, if you understand the governing rules and procedures.

IRS Allows Spouse to Roll Over IRA When Estate Was Named as the Beneficiary

The IRS permits IRA spousal beneficiaries to roll over distributions within 60 days in some cases, but not in others. In this private letter ruling, the IRS waived the 60-day deadline and let the surviving spouse roll over the IRA amount even though the IRA owner’s estate was named as the beneficiary.

How to Avoid Taxes and Penalties on Excess IRA Contributions

Horsesmouth Essential: Excess contributions can create a double whammy that can negate IRA savings. Here are some examples of how excess contributions happen and how to correct them.