Can Money withdrawn from IRA be deposited/reinvested by an estate executor within 60 day period?
A 60+ year old relative withdrew money from an IRA with the intention of redepositing it within 60 days (to avoid tax liability). They died before they were able to return it.
Is there anything the executor of the decedent’s estate can do to redeposit that money within the 60 days to avoid that liability?
If the “traditional” answer is that the executor can not deposit funds into an IRA on behalf of a decedent, might an exception be made in an instance such as this, where the money was just withdrawn from the decedent’s IRA with the intention of returning within the 60 days period expired?
We’ve been having a very difficult time getting an answer to this, any help would be greatly appreciated!
Thank you in advance!
Permalink Submitted by Alan - IRA critic on Tue, 2018-07-17 20:27
Rev Procedure 2003-16 clarifies that death and disability are grounds for the IRS to grant 60 day rollover relief pursuant to a PLR request. However, the fee for filing such a request is 10k plus legal fees, so the distribution would have to quite large to justify a PLR submission. If the beneficiary was a surviving spouse, the odds of the request being granted are higher. Note that Rev Proc 2016-47 (self certification without PLR) does not provide for owner’s death as an approved reason for the rollover.
Permalink Submitted by Bruce Steiner on Wed, 2018-07-18 17:58