- 9 -
requirements set forth in that section.6 Regulations under
section 408 further clarify that such a trust "must be maintained
at all times as a domestic trust in the United States." Sec.
1.408-2(b), Income Tax Regs.7
Petitioner maintains that the amounts withdrawn from his
Varian IRA were transferred to an account at the Hong Kong &
Shanghai Banking Corp., located in Hong Kong. Even if we were to
assume that the account at the Hong Kong bank was set up as a
trust or a custodial account8 (and petitioner has provided no
evidence in that regard), petitioner's rollover claim would fail
because he has not shown that the transfer was to a domestic
entity. The situs of a trust is generally defined to be the
place of performance of the active duties of the trustee, and
where the settlor selects a bank as the trustee, the location of
the bank has been held to be the situs of the trust. 90 C.J.S.
Trusts, sec. 160(b) at 12 (1955). Thus, the available evidence
strongly suggests that the situs of any trust to which the Varian
IRA proceeds were transferred is the Hong Kong branch office of
6Sec. 408(h) further provides that a "custodial account" may
be treated as a "trust" for purposes of sec. 408, but such
custodial account must also be maintained in the United States.
7In certain circumstances, a tax-free rollover from an IRA
may also be made into a qualified pension or profit-sharing plan.
See sec. 408(d)(3)(A)(ii). However, a qualified plan likewise
denotes a "trust created or organized in the United States".
Sec. 401(a).
8See supra note 6.
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