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mistake and, assuming a mistake was made, whether petitioner took
the necessary steps to correct the mistake and transfer the funds
to an IRA or other qualified plan.7
In Wood v. Commissioner, 93 T.C. 114 (1989), we discussed
the effect of a bookkeeping error committed by a financial
institution during the process of rolling over funds into an IRA.
In that case, the taxpayer received a distribution of cash and
stock from a profit-sharing plan and then established an IRA.
The taxpayer was aware that his distribution was required to be
rolled over into an IRA within 60 days of receipt. Acting with
this knowledge, the taxpayer did everything he could reasonably
be expected to do in order to roll over his lump-sum distribution
as required by law. For example, the taxpayer met with an IRA
trustee, instructed the IRA trustee to open the IRA, and
transferred the entire distribution to the IRA trustee for
deposit in his IRA. The IRA trustee assured the taxpayer that
the taxpayer’s request would be carried out.
However, because of a bookkeeping error by the IRA trustee,
certain of the trustee’s records indicated that part of the
distribution had not been transferred to the IRA within the
requisite 60-day period. Approximately 4 months after the
7Respondent states that he did not assert the 10-percent
additional tax on amounts received from a qualified retirement
plan under sec. 72(t) because petitioner was over the age of 59
1/2 at the time his IRA was closed.
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