Ezel / IRS Rulings / 201411026
Chief Counsel Advice 201411026 Released March 14, 2014 Advice

IRA property may lose exclusion after rollover

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This page covers one taxpayer's ruling from 2014, which can't be cited as precedent. Ask about your situation and see what the current Code and IRS guidance say, with citations.

Currency note: this determination was released in 2014
Statutory amendments, regulation changes, court decisions, or later IRS guidance may have changed the analysis since then. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, threshold, or position mentioned here.
Not precedent. Under 26 U.S.C. § 6110(k)(3), this written determination may not be used or cited as precedent. It resolved one taxpayer's situation on its specific facts, and identifying details were redacted by the IRS before release. The official IRS release (linked on this page as a PDF) is the authoritative source.
About this page: The plain-English summary and ruling snapshot below were written by Ezel based on the official IRS release. The full text is the IRS's own document.
View official IRS release (PDF)

Plain-English summary

Chief Counsel discussed whether property could be excluded from a bankruptcy estate. The existing exclusion was based on the spendthrift-type restriction applicable under ERISA. Counsel questioned whether the property would remain excluded after an IRA rollover if the IRA lacked a comparable restriction. The email also asked whether Bankruptcy Code section 522(c) would apply.

Ruling snapshot

  • Question: Would property remain excluded from a bankruptcy estate after an ERISA account was rolled into an IRA without a comparable restriction?
  • Outcome: Advice given, exclusion questioned absent an IRA restriction
  • Key authorities: 11 U.S.C. § 522(c); Patterson v. Shumate

Full text (IRS public release)

ID: CCA_2014021012194517 [Third Party Communication:

UILC: 9115.11-07 Date of Communication: Month DD, YYYY]

Number: 201411026
Release Date: 3/14/2014
From:
Sent: Monday, February 10, 2014 12:19:45 PM
To:
Cc:
Bcc:
Subject: RE: Another question

Hi, ------- I know what you mean.

Excluded property is excluded under Patterson v. Shumate because there is a
spendthrift-type restriction (per ERISA). If there isn’t such a restriction on the IRA (after
the rollover), I don’t see how the property could be excluded.

BTW, wouldn’t 522(c) apply (without getting into 522(g) or (h))?

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