A strange question was posed to me. Here are the facts:
Decedent prior to death received a distribution from an IRA. Decedent stated intention to "roll over" the amount to a new IRA. The decedent completed all forms for rollover (including beneficiary papers)and was about to fund new IRA when he died unexpectedly. He died prior to the completion of the 60 day period. Can the estate fund the new IRA based on the intent if done prior to completion of the 60 days?

I believe, but am not sure, that either the IRS permits it, or a court permitted it, in one case.

You still have to stay within the 60 days. No extension.

If you have any citations or references, I would greatly appreciate them. Thanks.

How about Gunther v. U.S., 573 F. Supp. 126 (1982) and 54.4981A-1T, Q&A d-5©.

Gunter says ...... what ?

To pick out one sentence from the case that summarizes the issue:

"Since Gunther, if he had lived, would have had the right to complete the tax-free rollover of the distribution into an IRA, the executor of his estate, possessing the powers and privileges of the decedent, also had the right to effect such rollover."

The District Court allowed the rollover.

Notwithstanding the above, it's interesting to note that in PLR 9237038, where the husband left his IRA to his wife, but she died before rolling it over, the Service refused to permit a rollover on her behalf after her death.

I think the results in the two situations can be reconciled. In the case where the participant died before rolling the distribution over, he died within 60 days of receiving the distribution, and the opportunity for hindsight was limited. However, in PLR 9237038, about two years had passed since the husband's death (although in that particular case, the taxpayer represented that the wife had already decided to roll the IRA over into her own name).

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Bruce Steiner, attorney
(212) 986-6000 (NY office)
(201) 862-1080 (NJ office)
also admitted in FL

Thanks for your help.