SECTION 2. BACKGROUND AND

GENERAL INFORMATION

.01 Section 401(a)(31) of the Code requires that a qualified trust provide for the direct transfer of eligible rollover distributions. A similar rule applies to § 403(a) annuity plans, § 403(b) tax-sheltered annuities and § 457 eligible governmental plans. (See §§ 403(a)(1), 403(b)(10) and 457(d)(1)(C).) If a distributee fails to elect to have an eligible rollover distribution paid directly to an eligible retirement plan, section 3405(c) provides that the payor of a designated distribution that is an eligible rollover distribution must withhold from such distribution an amount equal to 20 percent of such distribution.

.02 Sections 402(c)(3) and 408(d)(3) of the Code require generally that any amount distributed from a qualified trust or individual retirement plan must be transferred to an eligible retirement plan no later than the 60th day following the day of receipt in order to avoid inclusion in the distributee’s gross income. A similar rule applies to § 403(a) annuity plans, § 403(b) taxsheltered annuities and § 457 eligible governmental plans. (See §§ 403(a)(4)(B), 403(b)(8)(B) and 457(e)(16)(B).) .03 Section 72(t) of the Code imposes an additional tax on a distribution from a qualified retirement plan equal to 10-percent of the amount of the distribution included in the distributee’s gross income, subject to certain exceptions.

.04 Section 644 of the Economic Growth and Tax Relief Reconciliation Act of 2001 (“EGTRRA”), Pub. L. 107–16, amended § 402(c)(3) of the Code and added new § 408(d)(3)(I) to permit the Secretary to waive the 60-day rollover requirement “where the failure to waive such requirement would be against equity or good con

science, including casualty, disaster, or other events beyond the reasonable control of the individual subject to such requirement.” The Conference Report to EGTRRA provides examples of situations that may justify waiver of the 60-day rollover requirement, such as during a period in which a distribution in the form of a check was not cashed, or for errors committed by a financial institution, or in cases of inability to complete a rollover due to death, disability, hospitalization, incarceration, restrictions imposed by a foreign country or postal error. (H.R. Rep. No. 84, 107th Cong., 1st Sess. 252 (2001).) The amendments made by § 644 of EGTRRA apply to distributions after December 31, 2001.

.05 Under §§ 7508 and 7508A of the Code, the time for making a rollover may be postponed in the event of service in a combat zone or in the case of a Presidentially declared disaster or a terroristic or military action. See Regulations § 301.7508–1 and Rev. Proc. 2002–71, 2002–46 I.R.B. 850. .06 Rev. Proc. 2003–4, 2003–1 I.R.B. 123 (January 6, 2003), provides the procedures for issuing letter rulings, information letters, etc., on matters under the jurisdiction of the Commissioner, Tax Exempt and Government Entities Division.

.07 Rev. Proc. 2003–8, 2003–1 I.R.B. 236 (January 6, 2003), provides guidance for complying with the user-fee program as it pertains to requests for letter rulings, information letters, etc., on matters under the jurisdiction of the Commissioner, Tax Exempt and Government Entities Division.