The IRS has provided a self-certification procedure designed to help recipients of retirement plan distributions who inadvertently miss the 60-day time limit for properly rolling these amounts into another retirement plan or individual retirement arrangement (IRA).

Previously, an eligible distribution from an IRA or workplace retirement plan could only qualify for tax-free rollover treatment if the money was contributed to another IRA or workplace plan by the 60th day after it was received. If this time limit was not met, early distribution taxes could apply. Waivers for this requirement could only be obtained by applying for a private letter ruling.

Following this new guidance, eligible taxpayers who missed the time limit will now ordinarily qualify for a waiver if one or more of 11 circumstances, listed in the revenue procedure, apply to them. They include a distributioncheck that was misplaced and never cashed, the taxpayer’s home was severely damaged, a family memberdied, the taxpayer or a family member was seriously ill, the taxpayer was incarcerated or restrictions wereimposed by a foreign country.

Ordinarily, the IRS and plan administrators and trustees will honor a taxpayer’s truthful self-certification thatthey qualify for a waiver under these circumstances. Moreover, even if a taxpayer does not self-certify, the IRSnow has the authority to grant a waiver during a subsequent examination. The IRS has provided a sample selfcertificationletter that a taxpayer can use to notify the administrator or trustee of the retirement plan or IRAreceiving the rollover that they qualify for the waiver.

Rev. Proc. 2016-47 is effective August 24, 2016. Rev. Proc. 2003-16, I.R.B. 2003-4, 359, is modified byproviding that the IRS may grant a waiver during an examination of the taxpayer’s income tax return.

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