Ramzy M. and Lena Kopty - Page 22




                                        -22-                                          
              Petitioners contend that the stock certificate did not                  
         properly become invested in the IRA account until October 2,                 
         1998, when Mr. Kopty executed the Norwest form entitled “Self-               
         Directed IRA Rollover/Direct Rollover Documentation”.                        
         Petitioners point out that October 2, 1998, is 79 days after Mr.             
         Kopty had constructively “received” the certificate on July 15,              
         1998, and is beyond the 60-day period specified in section                   
         402(c)(3) during which a distributee is required to transfer the             
         property distributed to an eligible retirement plan.  Petitioners            
         further contend that the form executed on October 2, 1998, was               
         not properly completed and did not serve to transfer the stock to            
         Norwest.  In effect, petitioners’ position is that Mr. Kopty did             
         not elect to treat the contribution of his J.D. Edwards & Co.                
         stock certificate as a rollover contribution until October 2,                
         1998, when he executed the Norwest form entitled “Self-Directed              
         IRA Rollover/Direct Rollover Documentation”.                                 
              According to the regulations promulgated under section 402,             
         an election to treat a contribution to an IRA as a rollover                  
         contribution is made simply by designating the contribution as a             
         rollover contribution.  The regulations promulgated under section            
         402 provide as follows:                                                      
                   In order for a contribution of an eligible                         
              rollover distribution to an individual retirement plan                  
              to constitute a rollover and, thus, to qualify for                      
              current exclusion from gross income, a distributee                      
              must elect, at the time the contribution is made, to                    
              treat the contribution as a rollover contribution.  An                  






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