G. Richard and Sara B. Childs - Page 7

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               Petitioner, unaware that she was required to execute various           
          documents in order to accomplish the desired conversion, did not            
          execute these documents prior to August 15, 1990.  Thus, the                
          funds in petitioner's First American IRA's were not distributed             
          to and received by petitioner prior to August 15, 1990.                     
               First American Bank distributed and petitioner received the            
          account balance of petitioner's IRA's, i.e., $97,227.74, on or              
          about November 6, 1990.                                                     
          Distribution of the Fidelity IRA                                            
               Petitioners were accustomed to dealing with Fidelity by                
          telephone.  On August 14, 1990, petitioner Richard Childs                   
          telephoned Fidelity and requested that the account balance in               
          petitioner's Fidelity IRA be transferred into a non-IRA account.            
          Fidelity permitted customers to convert IRA's into non-IRA                  
          accounts by instructions given over the telephone.  Thus,                   
          Fidelity effected the requested conversion, and the account                 
          balance in petitioner's Fidelity IRA was constructively withdrawn           
          and received by petitioner on August 14, 1990.                              
          Petitioners' 1989 Return                                                    
               On their Federal income tax return (Form 1040) for 1989,               
          filed August 15, 1990, petitioners included the taxable portion             
          of the Transfer Refund in gross income.                                     









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