If a client receives rollover funds from an IRA in December of year one and deposits them within 60 days into another IRA in January of year two, is the rollover taxable to the client as year one income? The Taxbook page 13-21, under Rollover 60-day rule seems to indicate it is. I have not found any other discussions on reporting rollovers where the 60 day rule spans two tax years.
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If not rolled over witin 60 days then taxable in year distributed. In case you mention would be taxable in year distributed if not adhering to 60 day rule. Key words "are not rolled over in 60 days are taxable in the year distributed,"
Can be in January but date must be within the 60th day from December distribution date.
From TTB 3-21
60-day rule. A taxpayer has until the 60th day following a distribution to make a rollover contribution. Distributions that are not rolled over in 60 days are taxable in the year distributed, even if the 60-day period expires in the following year. Contributions made after the 60-day period are treated as regular contributions.
Also refer to IRS websiteLast edited by TAXNJ; 08-27-2015, 09:27 PM.Always cite your source for support to defend your opinion -
It's handled in exactly the same way on the tax return (provided the 60-day requirement is satisfied), no matter whether the rollover takes place in the same year or the following Jan/Feb."The only function of economic forecasting is to make astrology look respectful" - John Kenneth GalbraithComment
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