Private Letter Rulings

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L1: Private Letter Rulings
I am aware of a 72t on which unplanned errors in the distributions caused the 2009 amount to be more than the proper SEPP amount. I have seen reference elsewhere to requesting a PLR for potential remedy. Am I correct that PLR would be $10,000?
Any other thoughts are appreciated.
2011-07-26 17:20, By: quickjim, IP: []

L2: Private Letter Rulings
It would be more than 10k due to legal costs to prepare and file the request. 10k is near the amount that the IRS charges to file the request.

2011-07-26 17:32, By: Alan S., IP: []

L3: Private Letter Rulings
Thanks Alan. I am just thinking about the fee to file it with the IRS. I had thought it was $10,000, but you seem to state that is aproximately that amount.
2011-07-26 17:42, By: quickjim, IP: []

L2: Private Letter Rulings
My understanding is that’s just the IRS fee. Then the attorney fee to prepare the appeal, etc. can be an additional $5-$10,000.
Give us a summary of the facts to see if you have any chance of winning, before you spend any time or money.
2011-07-26 17:41, By: dlzallestaxes, IP: []

L3: Private Letter Rulings
During 2009, when the participant turned 56, through some error, there were 13 monthly distributions during 2009. Calculated amount is $34,752.00 and instead $37,560.46 was distributed for the year. The situation was discovered in June 2011.Schedule started
in 2001 and the SEPP will end at age 59.5, which will be December 2012.
2011-07-26 17:49, By: quickjim, IP: []

L4: Private Letter Rulings
The IRS has ruled favorably for taxpayers in cases where the taxpayer can reasonably establish that the error was not their fault, so the participant will have to come up with a full explanation how this happened for the IRS
to rule. Sometimes the cost and effort is not worth it, but in this case the total dollar penalties probably make the effort worthwhile. The IRS has been generally sympathetic to self reported errors with reasonable cause for the error.
If the IRS rules favorably, they would probably extend the 60 day rollover period and require that the excess amount for 2009 be rolled back into the IRA. The 2009 return could then be amended as well for the reduced taxable
It is rather surprising that in Jan 2010, the 1099R showing an unexpected amount was missed under the circumstances. Since distributions were done monthly, a routine 60 day rollover could probably have been done for the extra

2011-07-26 18:29, By: Alan S., IP: []

L4: Private Letter Rulings
Meet with a branch manager at the financial institution that made the extra payment, if it was their error and not yours. Put them on notice, in writing, that they are responsible for getting it straightened out with IRS. It’s usually best to have the letter
from an attorney, or with you at the meeting.
2011-07-26 18:50, By: dlzallestaxes, IP: []