60-day IRA rollover deadline waived for a fraud-scheme victim

Plain-English summary

A taxpayer withdrew money from a traditional IRA and normally would have 60 days
to roll it into another IRA to avoid tax. Before completing the rollover, the
taxpayer fell victim to a fraud scheme: scammers posing as company and
government-agency employees claimed the taxpayer's identity had been stolen,
gained access to the taxpayer's computer, and directed the taxpayer to move the
IRA money to accounts they controlled. The taxpayer asked the IRS to waive the
60-day rollover deadline. Under § 408(d)(3)(I), the IRS may waive that deadline
when enforcing it would be against equity or good conscience, including events
beyond the individual's control. Finding the facts consistent with the taxpayer
being a fraud victim, the IRS granted the waiver and gave the taxpayer 60 days
from the date of the letter to complete the rollover. This spares the taxpayer
from having the withdrawal taxed as an early distribution.

Ruling snapshot

• Question: Should the IRS waive the 60-day IRA rollover requirement because the taxpayer was a victim of fraud?
• Outcome: Approved (waiver granted; 60 days from the letter to complete the rollover)
• Key authorities: IRC § 408(d)(3), § 408(d)(3)(I); Rev. Proc. 2003-16

Full text (IRS public release)

Department of the Treasury
Internal Revenue Service
Tax Exempt and Government Entities
IRS Employee Plans

March 9, 2026

Uniform Issue List; 408.03-00

Release Number: 202623022
Release Date: 6/5/26

Legend

Taxpayer A =
IRA B =
Company C =
Agency D =
Agency E =
Agency F =
Individual 1 =
Individual 2 =
Amount 1 =
Date 1 =
Date 2 =
Date 3 =
Date 4 =
Date 5 =

Dear ***:

This is in response to your request dated January 26, 2026, as supplemented by correspondence dated February 20, 2026, submitted on your behalf by your authorized representative, in which you request a waiver of the 60-day rollover requirement contained in section 408(d)(3) of the Internal Revenue Code (the "Code").

You submitted, under penalties of perjury, the following facts and representations in support of your ruling request.

Taxpayer A represents that on Date 1, he withdrew Amount 1 from IRA B, a traditional IRA under section 408(a) of the Code. Taxpayer A asserts that [illegible] was unable to accomplish a rollover of Amount 1 within the 60-day period prescribed by section 408(d)(3) because [illegible] was the victim of a fraud scheme.

On Date 2, Taxpayer A was contacted by Individual 1, who identified as " " and falsely claimed to be an employee of Company C. Individual 1 informed Taxpayer A that identity had been stolen and loans had been fraudulently obtained in Taxpayer A's name. Individual 1 gained access to Taxpayer A's personal computer. Individual 1 instructed Taxpayer to make withdrawals from IRA B and transfer the funds to an account number provided by the fraudster.

On Date 3, a letter falsely claiming to be from Agency E informed Taxpayer A that Agency E received documents from Agency D regarding the supposed identity theft. On Date 4, Taxpayer A received a letter falsely claiming to be sent from Agency E, which provided that Individual 2 " " to be a case manager from Agency D, and had been appointed to do an investigation.

On Date 5, Taxpayer A made unsuccessful attempts to contact Individuals 1 and 2. At that time he realized [illegible] was the victim of fraud and filed a complaint with Agency F.

Based on the above facts and representations, Taxpayer A requests that the Internal Revenue Service (the "Service") waive the 60-day rollover requirement under section 408(d)(3) of the Code with respect to the distribution of Amount 1 from IRA B on Date 1.

Section 408(a) of the Code defines an individual retirement account to mean a trust created or organized in the United States and requires that the trustee be a bank or an approved non-bank trustee.

Section 408(d)(1) of the Code provides that, except as otherwise provided in section 408(d), any amount paid or distributed out of an IRA shall be included in gross income by the payee or distributee, as the case may be, in the manner provided under section 72.

Section 408(d)(3) of the Code provides the rules applicable to IRA rollovers.

Section 408(d)(3)(A) of the Code provides that section 408(d)(1) does not apply to any amount paid or distributed out of an IRA to the individual for whose benefit the IRA is maintained if:

(i) the entire amount received (including money or any other property) is paid into an IRA for the benefit of such individual not later than the 60th day after the day on which the individual receives the payment or distribution; or

(ii) the entire amount received (including money and any other property) is paid into an eligible retirement plan (other than an IRA) for the benefit of such individual not later than the 60th day after the date on which the payment or distribution is received, except that the maximum amount which may be paid into such plan may not exceed the portion of the amount received which is includible in gross income (determined without regard to section 408(d)(3)).

Section 408(d)(3)(B) of the Code provides that the rollover provisions of section 408(d)(3) do not apply to any amount received by an individual from an IRA if at any time during the 1-year period ending on the day of such receipt such individual received any other amount described in section 408(d)(3)(A)(i) from an IRA that was not includible in gross income because of the application of the rollover provisions in section 408(d)(3).

Section 408(d)(3)(E) of the Code provides that the rollover provisions of section 408(d)(3) do not apply to any amount required to be distributed under section 408(a)(6).

Section 408(d)(3)(I) of the Code provides that the Secretary of the Treasury may waive the 60-day requirement under sections 408(d)(3)(A) and 408(d)(3)(D) where the failure to waive such requirement would be against equity or good conscience, including casualty, disaster, or other events beyond the reasonable control of the individual subject to such requirement.

Section 3.02 of Revenue Procedure 2003-16, 2003-4 I.R.B. 359 ("Rev. Proc. 2003-16"), provides that the Service will issue a ruling waiving the 60-day rollover requirement in cases where the failure to waive such requirement would be against equity or good conscience, including casualty, disaster or other events beyond the reasonable control of the taxpayer. In determining whether to grant a waiver of the 60-day rollover requirement pursuant to section 408(d)(3)(I) of the Code, the Service will consider all relevant facts and circumstances, including: (1) errors committed by a financial institution; (2) inability to complete a rollover due to death, disability, hospitalization, incarceration, restrictions imposed by a foreign country or postal error; (3) the use of the amount distributed (for example, in the case of payment by check, whether the check was cashed); and (4) the time elapsed since the distribution occurred.

The information and documentation submitted are consistent with Taxpayer A's assertion that he was unable to accomplish a rollover of Amount 1 within the 60-day period prescribed by section 408(d)(3) of the Code because he was the victim of a fraud scheme.

Therefore, pursuant to section 408(d)(3)(I) of the Code, the Service waives the 60-day rollover requirement with respect to the distribution of Amount 1 from IRA B on Date 2. Taxpayer A has 60 days from the issuance of this letter to contribute an amount not to exceed Amount 1 into an IRA. Provided all other requirements of section 408(d)(3), except the 60-day requirement, are met with respect to such contribution, the contribution will be considered a rollover contribution within the meaning of section 408(d)(3).

This ruling does not authorize the rollover of amounts that are required to be distributed by section 401(a)(9) of the Code.

No opinion is expressed as to the tax treatment of the transactions described herein under the provisions of any other section of either the Code or regulations which may be applicable thereto.

This letter is directed only to the taxpayer who requested it. Section 6110(k)(3) of the Code provides that it may not be used or cited as precedent.

Pursuant to the power of attorney on file with this office, a copy of this letter ruling is being sent to your authorized representative.

If you wish to inquire about this ruling, please contact * (Identification Number *) at () -****. Please address all correspondence to SE:T:EP:RA:T1.

Sincerely,

Frederick L. Parker, Manager
Employee Plans Technical Group

Enclosures:
Notice of Intention to Disclose
Deleted copy of this letter

cc: