- 5 -
been received from Western, and, accordingly, it became the
bank's understanding that the IRA accounts were not to have been
opened. By a letter dated July 19, 1991, the Kansas bank advised
petitioner of the return of a $27 custodial fee, which had been
paid by the credit union with respect to petitioner's IRA
account. The fee was returned because the IRA had not been
funded and the IRA accounts had been closed.
OPINION
Section 402(a)(1)3 provides the general rule that amounts
distributed by a qualified plan are taxable in the year of
distribution in accordance with the provisions of section 72.
Section 402(a)(5) provides that taxation of a current
distribution may be deferred if it is rolled over into an
eligible retirement plan within 60 days of the distribution.
Petitioners bear the burden of proving that respondent's
determination is in error. Rule 142(a); Welch v. Helvering, 290
U.S. 111 (1933). Accordingly, petitioners must show that the
cash distribution in question was rolled over into an eligible
retirement plan within 60 days.
Petitioner concedes that the $7,005.77 of the Plan
distribution that was not deposited and the $50,000 that was
3 Sec. 402 as used in this opinion refers to the section in
effect for distributions made prior to Dec. 31, 1992. The
Unemployment Compensation Amendments of 1992, Pub. L. 102-318,
sec. 521(a), 106 Stat. 290, 300, restructured and reconfigured
sec. 402 for years after the 1992 calendar year.
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