Self-Certification of Waiver Permitted for Late Rollover of Retirement Funds

In Rev. Proc. 2016-47, the IRS announced that a taxpayer who fails to meet the requirement to roll over distributions from retirement accounts within the normal 60-day period can make a written self-certification to an IRA trustee or plan administrator that a contribution meets one of the 11 specific reasons listed in the revenue procedure for excusing the missed 60-day deadline. The trustee or administrator can rely on the taxpayer’s self-certification in accepting and reporting the receipt of a rollover contribution, unless the trustee or administrator has actual knowledge that is contrary to the self-certification. The certification must match the sample in the appendix of the revenue procedure word for word or be “substantially similar in all material respects.”

For a taxpayer to qualify for self-certification, the IRS cannot have previously denied relief to the taxpayer for that rollover, and the taxpayer must have missed the 60-day deadline for one of the following 11 reasons:

• The financial institution receiving the contribution or making the distribution to which the contribution relates made an error;
• The distribution check was misplaced and never cashed;
• The distribution was deposited into an account that the taxpayer mistakenly thought was an eligible retirement plan;
• The taxpayer’s principal residence was severely damaged;
• A member of the taxpayer’s family died;
• The taxpayer or a member of the taxpayer’s family was seriously ill;
• The taxpayer was incarcerated;
• Restrictions were imposed by a foreign country;
• The post office made an error;
• The distribution was made on account of a levy under Sec. 6331, the proceeds of which have been returned to the taxpayer; or
• The party making the distribution delayed providing information that the receiving plan or IRA required to complete the rollover despite the taxpayer’s reasonable efforts to obtain it.

The rollover contribution must be made to the plan or IRA as soon as practicable after the reason or reasons for missing the 60-day deadline no longer prevent the taxpayer from making the contribution. This requirement is deemed to be satisfied if the contribution is made within 30 days after the reason or reasons no longer prevent the taxpayer from making the contribution. Form 5498, IRA Contribution Information, will be amended to permit plan trustees or administrators to report these rollovers.

A taxpayer providing a self-certification may report the contribution as a valid rollover unless later informed otherwise by the IRS. As the revenue procedure states, the self-certification is not a waiver by the IRS of the 60-day rollover requirement, and the IRS can still deny the waiver on audit if it determines the taxpayer did not meet the waiver requirements.