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Free tax prep Publication 908 - Introductory Material Table of Contents Future Developments What's New Reminders Introduction Useful Items - You may want to see: Future Developments For the latest information about developments related to Publication 908, such as legislation enacted after it was published, go to www. Free tax prep irs. Free tax prep gov/pub908. Free tax prep What's New Expiration of provision for catch-up contributions for IRC section 401(k) participants whose employer filed bankruptcy. Free tax prep  The Pension Protection Act of 2006, P. Free tax prep L. Free tax prep 109-280, previously allowed additional contributions of up to $7,000 in a traditional or Roth IRA for employees who participated in an IRC section 401(k) plan of an employer that filed bankruptcy in an earlier year. Free tax prep This provision was not extended for tax years beginning on or after January 1, 2010. Free tax prep Automatic 6-month extension of time to file a bankruptcy estate return now available for individuals in Chapter 7 or 11 bankruptcy. Free tax prep  Beginning June 24, 2011, the IRS clarified in T. Free tax prep D. Free tax prep 9531 that there is available an automatic 6-month extension of time to file a bankruptcy estate income tax return for individuals in Chapter 7 or Chapter 11 bankruptcy proceedings upon filing a required application. Free tax prep The previous extension of time to file a bankruptcy estate return was 5 months. Free tax prep Reminders The Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) of 2005. Free tax prep  The changes to the U. Free tax prep S. Free tax prep Bankruptcy Code enacted by BAPCA are incorporated throughout this publication. Free tax prep Debtors filing under chapters 7, 11, 12, and 13 of the Bankruptcy Code must file all applicable federal, state, and local tax returns that become due after a case commences. Free tax prep Failure to file tax returns timely or obtain an extension can cause a bankruptcy case to be converted to another chapter or dismissed. Free tax prep In chapter 13 cases, the debtor must file all required tax returns for tax periods ending within 4 years of the filing of the bankruptcy petition. Free tax prep Photographs of missing children. Free tax prep  The IRS is a proud partner with the National Center for Missing and Exploited Children. Free tax prep Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. Free tax prep You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child. Free tax prep Introduction This publication is not intended to cover bankruptcy law in general, or to provide detailed discussions of the tax rules for the more complex corporate bankruptcy reorganizations or other highly technical transactions. Free tax prep Additionally, this publication is not updated on an annual basis and may not reflect recent developments in bankruptcy or tax law. Free tax prep If you need more guidance on the bankruptcy or tax laws applicable to your case, you should seek professional advice. Free tax prep This publication explains the basic federal income tax aspects of bankruptcy. Free tax prep A fundamental goal of the bankruptcy laws enacted by Congress is to give an honest debtor a financial “fresh start”. Free tax prep This is accomplished through the bankruptcy discharge, which is a permanent injunction (court ordered prohibition) against the collection of certain debts as a personal liability of the debtor. Free tax prep Bankruptcy proceedings begin with the filing of either a voluntary petition in the United States Bankruptcy Court, or in certain cases an involuntary petition filed by creditors. Free tax prep This filing creates the bankruptcy estate. Free tax prep The bankruptcy estate generally consists of all of the assets the individual or entity owns on the date the bankruptcy petition was filed. Free tax prep The bankruptcy estate is treated as a separate taxable entity for individuals filing bankruptcy petitions under chapter 7 or 11 of the Bankruptcy Code, discussed later. Free tax prep The tax obligations of taxable bankruptcy estates are discussed later under Individuals in Chapter 7 or 11. Free tax prep Generally, when a debt owed to another person or entity is canceled, the amount canceled or forgiven is considered income that is taxed to the person owing the debt. Free tax prep If a debt is canceled under a bankruptcy proceeding, the amount canceled is not income. Free tax prep However, the canceled debt reduces other tax benefits to which the debtor would otherwise be entitled. Free tax prep See Debt Cancellation, later. Free tax prep Useful Items - You may want to see: Publication 225 Farmer's Tax Guide 525 Taxable and Nontaxable Income 536 Net Operating Losses (NOLs) for Individuals, Estates, and Trusts 538 Accounting Periods and Methods 544 Sales and Other Dispositions of Assets 551 Basis of Assets 4681 Canceled Debts, Foreclosures, Repossessions, and Abandonments Form (and Instructions) SS-4 Application for Employer Identification Number, and separate instructions 982 Reduction of Tax Attributes Due to Discharge of Indebtedness (and Section 1082 Basis Adjustment) 1040 U. Free tax prep S. Free tax prep Individual Income Tax Return, and separate instructions Schedule SE (Form 1040) Self-Employment Tax 1040X Amended U. Free tax prep S. Free tax prep Individual Income Tax Return, and separate instructions 1041 U. Free tax prep S. Free tax prep Income Tax Return for Estates and Trusts, and separate instructions 1041-ES Estimated Income Tax for Estates and Trusts 1041-V Payment Voucher 4506 Request for Copy of Tax Return 4506-T Request for Transcript of Tax Return 4852 Substitute for Form W-2, Wage and Tax Statement, or Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc. Free tax prep 4868 Application for Automatic Extension of Time To File U. Free tax prep S. Free tax prep Individual Income Tax Return 7004 Application for Automatic Extension of Time To File Certain Business Income Tax, Information, and Other Returns See How To Get Tax Help, later, for information about getting these publications and forms. Free tax prep Prev  Up  Next   Home   More Online Publications
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Tax Relief for Victims of Hurricane Sandy in Rhode Island

RI-2012-30, Nov. 15, 2012

BOSTON — Victims of Hurricane Sandy that began on Oct. 26, 2012 in parts of Rhode Island may qualify for tax relief from the Internal Revenue Service.

The President has declared Newport and Washington counties a federal disaster area. Individuals who reside or have a business in these counties may qualify for tax relief.

The declaration permits the IRS to postpone certain deadlines for taxpayers who reside or have a business in the disaster area. For instance, certain deadlines falling on or after Oct. 26, and on or before Feb. 1, have been postponed to Feb. 1, 2013.  

In addition, the IRS is waiving the failure-to-deposit penalties for employment and excise tax deposits due on or after Oct. 26, and on or before Nov. 26, as long as the deposits are made by Nov. 26, 2012.

If an affected taxpayer receives a penalty notice from the IRS, the taxpayer should call the telephone number on the notice to have the IRS abate any interest and any late filing or late payment penalties that would otherwise apply. Penalties or interest will be abated only for taxpayers who have an original or extended filing, payment or deposit due date, including an extended filing or payment due date, that falls within the postponement period.

The IRS automatically identifies taxpayers located in the covered disaster area and applies automatic filing and payment relief. But affected taxpayers who reside or have a business located outside the covered disaster area need to call the IRS disaster hotline at 866-562-5227 to request this tax relief.

For a full description of the relief being provided by the IRS to the victims of Hurricane Sandy, visit IRS.gov.

Covered Disaster Area

The counties above constitute a covered disaster area for purposes of Treas. Reg. § 301.7508A-1(d)(2) and are entitled to the relief detailed below.

Affected Taxpayers

Taxpayers considered to be affected taxpayers eligible for the postponement of time to file returns, pay taxes and perform other time-sensitive acts are those taxpayers listed in Treas. Reg. § 301.7508A-1(d)(1), and include individuals who live, and businesses whose principal place of business is located, in the covered disaster area. Taxpayers not in the covered disaster area, but whose records necessary to meet a deadline listed in Treas. Reg. § 301.7508A-1(c) are in the covered disaster area, are also entitled to relief. In addition, all relief workers affiliated with a recognized government or philanthropic organization assisting in the relief activities in the covered disaster area and any individual visiting the covered disaster area who was killed or injured as a result of the disaster are entitled to relief.

Grant of Relief

Under section 7508A, the IRS gives affected taxpayers until Feb. 1 to file most tax returns (including individual, corporate, and estate and trust income tax returns; partnership returns, S corporation returns, and trust returns; estate, gift, and generation-skipping transfer tax returns; and employment and certain excise tax returns), or to make tax payments, including estimated tax payments, that have either an original or extended due date occurring on or after Oct. 26 and on or before Feb. 1.

The IRS also gives affected taxpayers until Feb. 1 to perform other time-sensitive actions described in Treas. Reg. § 301.7508A-1(c)(1) and Rev. Proc. 2007-56, 2007-34 I.R.B. 388 (Aug. 20, 2007), that are due to be performed on or after Oct. 26 and on or before Feb. 1.

This relief also includes the filing of Form 5500 series returns, in the manner described in section 8 of Rev. Proc. 2007-56. The relief described in section 17 of Rev. Proc. 2007-56, pertaining to like-kind exchanges of property, also applies to certain taxpayers who are not otherwise affected taxpayers and may include acts required to be performed before or after the period above.

The postponement of time to file and pay does not apply to information returns in the W-2, 1098, 1099 series, or to Forms 1042-S or 8027. Penalties for failure to timely file information returns can be waived under existing procedures for reasonable cause. Likewise, the postponement does not apply to employment and excise tax deposits. The IRS, however, will abate penalties for failure to make timely employment and excise tax deposits due on or after Oct. 26 and on or before Nov. 26 provided the taxpayer makes these deposits by Nov. 26.

Casualty Losses

Affected taxpayers in a federally declared disaster area have the option of claiming disaster-related casualty losses on their federal income tax return for either this year or last year. Claiming the loss on an original or amended return for last year will get the taxpayer an earlier refund, but waiting to claim the loss on this year’s return could result in a greater tax saving, depending on other income factors.

Individuals may deduct personal property losses that are not covered by insurance or other reimbursements. For details, see Form 4684 and its instructions.

Affected taxpayers claiming the disaster loss on last year’s return should put the Disaster Designation “Rhode Island/Hurricane Sandy” at the top of the form so that the IRS can expedite the processing of the refund.

Other Relief

The IRS will waive the usual fees and expedite requests for copies of previously filed tax returns for affected taxpayers. Taxpayers should put the assigned Disaster Designation in red ink at the top of Form 4506, Request for Copy of Tax Return, or Form 4506-T, Request for Transcript of Tax Return, as appropriate, and submit it to the IRS.

Affected taxpayers who are contacted by the IRS on a collection or examination matter should explain how the disaster impacts them so that the IRS can provide appropriate consideration to their case.

Taxpayers may download forms and publications from the official IRS website, irs.gov, or order them by calling 800-TAX-FORM (800-829-3676). The IRS toll-free number for general tax questions is 800-829-1040.

Related Information

Disaster Assistance and Emergency Relief for Individuals and Businesses

Recent IRS Disaster Relief Announcements

 

Page Last Reviewed or Updated: 05-Nov-2013

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Free tax prep 8. Free tax prep   Distributions and Rollovers Table of Contents DistributionsMinimum Required Distributions No Special 10-Year Tax Option Transfer of Interest in 403(b) ContractAfter-tax contributions. Free tax prep Permissive service credit. Free tax prep Tax-Free RolloversHardship exception to rollover rules. Free tax prep Eligible retirement plans. Free tax prep Nonqualifying distributions. Free tax prep Second rollover. Free tax prep Gift Tax Distributions Permissible distributions. Free tax prep   Generally, a distribution cannot be made from a 403(b) account until the employee: Reaches age 59½, Has a severance from employment, Dies, Becomes disabled, In the case of elective deferrals, encounters financial hardship, or Has a qualified reservist distribution. Free tax prep In most cases, the payments you receive or that are made available to you under your 403(b) account are taxable in full as ordinary income. Free tax prep In general, the same tax rules apply to distributions from 403(b) plans that apply to distributions from other retirement plans. Free tax prep These rules are explained in Publication 575. Free tax prep Publication 575 also discusses the additional tax on early distributions from retirement plans. Free tax prep Retired public safety officers. Free tax prep   If you are an eligible retired public safety officer, distributions of up to $3,000, made directly from your 403(b) plan to pay accident, health, or long-term care insurance, are not included in your taxable income. Free tax prep The premiums can be for you, your spouse, or your dependents. Free tax prep   A public safety officer is a law enforcement officer, fire fighter, chaplain, or member of a rescue squad or ambulance crew. Free tax prep   For additional information, see Publication 575. Free tax prep Distribution for active reservist. Free tax prep   The 10% penalty for early withdrawals will not apply to a qualified reservist distribution attributable to elective deferrals from a 403(b) plan. Free tax prep A qualified reservist distribution is a distribution that is made: To an individual who is a reservist or national guardsman and who was ordered or called to active duty for a period in excess of 179 days or for an indefinite period; and During the period beginning on the date of the order or call to duty and ending at the close of the active duty period. Free tax prep Minimum Required Distributions You must receive all, or at least a certain minimum, of your interest accruing after 1986 in the 403(b) plan by April 1 of the calendar year following the later of the calendar year in which you become age 70½, or the calendar year in which you retire. Free tax prep Check with your employer, plan administrator, or provider to find out whether this rule also applies to pre-1987 accruals. Free tax prep If not, a minimum amount of these accruals must begin to be distributed by the later of the end of the calendar year in which you reach age 75 or April 1 of the calendar year following retirement. Free tax prep For each year thereafter, the minimum distribution must be made by the last day of the year. Free tax prep If you do not receive the required minimum distribution, you are subject to a nondeductible 50% excise tax on the difference between the required minimum distribution and the amount actually distributed. Free tax prep No Special 10-Year Tax Option A distribution from a 403(b) plan does not qualify as a lump-sum distribution. Free tax prep This means you cannot use the special 10-year tax option to calculate the taxable portion of a 403(b) distribution. Free tax prep For more information, see Publication 575. Free tax prep Transfer of Interest in 403(b) Contract Contract exchanges. Free tax prep   If you transfer all or part of your interest from a 403(b) contract to another 403(b) contract (held in the same plan), the transfer is tax free, and is referred to as a contract exchange. Free tax prep This was previously known as a 90-24 transfer. Free tax prep A contract exchange is similar to a 90-24 transfer with one major difference. Free tax prep Previously, you were able to accomplish the transfer without your employer’s involvement. Free tax prep After September 24, 2007, all such transfers are accomplished through a contract exchange requiring your employer’s involvement. Free tax prep In addition, the plan must provide for the exchange and the transferred interest must be subject to the same or stricter distribution restrictions. Free tax prep Finally, your accumulated benefit after the exchange must be equal to what it was before the exchange. Free tax prep   Transfers that do not satisfy this rule are plan distributions and are generally taxable as ordinary income. Free tax prep Plan-to-plan transfers. Free tax prep   You may also transfer part or all of your interest from a 403(b) plan to another 403(b) plan if you are an employee of (or were formerly employed by) the employer of the plan to which you would like to transfer. Free tax prep Both the initial plan and the receiving plan must provide for transfers. Free tax prep Your accumulated benefit after the transfer must be at least equal to what it was before the transfer. Free tax prep The new plan’s restrictions on distributions must be the same or stricter than those of the original plan. Free tax prep Tax-free transfers for certain cash distributions. Free tax prep   A tax-free transfer may also apply to a cash distribution of your 403(b) account from an insurance company that is subject to a rehabilitation, conservatorship, insolvency, or similar state proceeding. Free tax prep To receive tax-free treatment, you must do all of the following: Withdraw all the cash to which you are entitled in full settlement of your contract rights or, if less, the maximum permitted by the state. Free tax prep Reinvest the cash distribution in a single policy or contract issued by another insurance company or in a single custodial account subject to the same or stricter distribution restrictions as the original contract not later than 60 days after you receive the cash distribution. Free tax prep Assign all future distribution rights to the new contract or account for investment in that contract or account if you received an amount that is less than what you are entitled to because of state restrictions. Free tax prep   In addition to the preceding requirements, you must provide the new insurer with a written statement containing all of the following information: The gross amount of cash distributed under the old contract. Free tax prep The amount of cash reinvested in the new contract. Free tax prep Your investment in the old contract on the date you receive your first cash distribution. Free tax prep   Also, you must attach the following items to your timely filed income tax return in the year you receive the first distribution of cash. Free tax prep A copy of the statement you gave the new insurer. Free tax prep A statement that includes: The words ELECTION UNDER REV. Free tax prep PROC. Free tax prep 92-44, The name of the company that issued the new contract, and The new policy number. Free tax prep Direct trustee-to-trustee transfer. Free tax prep   If you make a direct trustee-to-trustee transfer, from your governmental 403(b) account to a defined benefit governmental plan, it may not be includible in gross income. Free tax prep   The transfer amount is not includible in gross income if it is made to: Purchase permissive service credits, or Repay contributions and earnings that were previously refunded under a forfeiture of service credit under the plan, or under another plan maintained by a state or local government employer within the same state. Free tax prep After-tax contributions. Free tax prep   For distributions beginning after December 31, 2006, after-tax contributions can be rolled over between a 403(b) plan and a defined benefit plan, IRA, or a defined contribution plan. Free tax prep If the rollover is to or from a 403(b) plan, it must occur through a direct trustee-to-trustee transfer. Free tax prep Permissive service credit. Free tax prep   A permissive service credit is credit for a period of service recognized by a defined benefit governmental plan only if you voluntarily contribute to the plan an amount that does not exceed the amount necessary to fund the benefit attributable to the period of service and the amount contributed is in addition to the regular employee contribution, if any, under the plan. Free tax prep   A permissive service credit may also include service credit for up to 5 years where there is no performance of service, or service credited to provide an increased benefit for service credit which a participant is receiving under the plan. Free tax prep   Check with your plan administrator as to the type and extent of service that may be purchased by this transfer. Free tax prep Tax-Free Rollovers You can generally roll over tax free all or any part of a distribution from a 403(b) plan to a traditional IRA or a non-Roth eligible retirement plan, except for any nonqualifying distributions, described later. Free tax prep You may also roll over any part of a distribution from a 403(b) plan by converting it through a direct rollover, described below, to a Roth IRA. Free tax prep Conversion amounts are generally includible in your taxable income in the year of the distribution from your 403(b) account. Free tax prep See Publication 590 for more information about conversion into a Roth IRA. Free tax prep Note. Free tax prep A participant is required to roll over distribution amounts received within 60 days in order for the amount to be treated as nontaxable. Free tax prep Distribution amounts that are rolled over within the 60 days are not subject to the 10% early distribution penalty. Free tax prep Rollovers to and from 403(b) plans. Free tax prep   You can generally roll over tax free all or any part of a distribution from an eligible retirement plan to a 403(b) plan. Free tax prep Beginning January 1, 2008, distributions from tax-qualified retirement plans and tax-sheltered annuities can be converted by making a direct rollover into a Roth IRA subject to the restrictions that currently apply to rollovers from a traditional IRA into a Roth IRA. Free tax prep Converted amounts are generally includible in your taxable income in the year of the distribution from your 403(b) account. Free tax prep See Publication 590 for more information on conversion into a Roth IRA. Free tax prep   If a distribution includes both pre-tax contributions and after-tax contributions, the portion of the distribution that is rolled over is treated as consisting first of pre-tax amounts (contributions and earnings that would be includible in income if no rollover occurred). Free tax prep This means that if you roll over an amount that is at least as much as the pre-tax portion of the distribution, you do not have to include any of the distribution in income. Free tax prep   For more information on rollovers and eligible retirement plans, see Publication 575. Free tax prep If you roll over money or other property from a 403(b) plan to an eligible retirement plan, see Publication 575 for information about possible effects on later distributions from the eligible retirement plan. Free tax prep Hardship exception to rollover rules. Free tax prep   The IRS may waive the 60-day rollover period if the failure to waive such requirement would be against equity or good conscience, including cases of casualty, disaster, or other events beyond the reasonable control of an individual. Free tax prep   To obtain a hardship exception, you must apply to the IRS for a waiver of the 60-day rollover requirement. Free tax prep You apply for the waiver by following the general instructions used in requesting a letter ruling. Free tax prep These instructions are stated in Revenue Procedure 2013-4, 2013-1 I. Free tax prep R. Free tax prep B. Free tax prep 126 available at www. Free tax prep irs. Free tax prep gov/irb/2013-01_IRB/ar09. Free tax prep html, or see the latest annual update. Free tax prep You must also pay a user fee with the application. Free tax prep The user fee for a rollover that is less than $50,000 is $500. Free tax prep For rollovers that are $50,000 or more, see Revenue Procedure 2013-8, 2013-1 I. Free tax prep R. Free tax prep B. Free tax prep 237 available at www. Free tax prep irs. Free tax prep gov/irb/2013-01_IRB/ar13. Free tax prep html, or see the latest annual update. Free tax prep   In determining whether to grant a waiver, the IRS will consider all relevant facts and circumstances, including: Whether errors were made by the financial institution; Whether you were unable to complete the rollover due to death, disability, hospitalization, incarceration, restrictions imposed by a foreign country, or postal error; Whether you used the amount distributed (for example, in the case of payment by check, whether you cashed the check); and How much time has passed since the date of distribution. Free tax prep   For additional information on rollovers, see Publication 590. Free tax prep Eligible retirement plans. Free tax prep   The following are considered eligible retirement plans. Free tax prep Individual retirement arrangements. Free tax prep Roth IRA. Free tax prep 403(b) plans. Free tax prep Government eligible 457 plans. Free tax prep Qualified retirement plans. Free tax prep  If the distribution is from a designated Roth account, then the only eligible retirement plan is another designated Roth account or a Roth IRA. Free tax prep Nonqualifying distributions. Free tax prep   You cannot roll over tax free: Minimum required distributions (generally required to begin at age 70½), Substantially equal payments over your life or life expectancy, Substantially equal payments over the joint lives or life expectancies of your beneficiary and you, Substantially equal payments for a period of 10 years or more, Hardship distributions, or Corrective distributions of excess contributions or excess deferrals, and any income allocable to the excess, or excess annual additions and any allocable gains. Free tax prep Rollover of nontaxable amounts. Free tax prep    You may be able to roll over the nontaxable part of a distribution (such as your after-tax contributions) made to another eligible retirement plan, traditional IRA, or Roth IRA. Free tax prep The transfer must be made either through a direct rollover to an eligible plan that separately accounts for the taxable and nontaxable parts of the rollover or through a rollover to a traditional IRA or Roth IRA. Free tax prep   If you roll over only part of a distribution that includes both taxable and nontaxable amounts, the amount you roll over is treated as coming first from the taxable part of the distribution. Free tax prep Direct rollovers of 403(b) plan distributions. Free tax prep   You have the option of having your 403(b) plan make the rollover directly to a traditional IRA, Roth IRA, or new plan. Free tax prep Before you receive a distribution, your plan will give you information on this. Free tax prep It is generally to your advantage to choose this option because your plan will not withhold tax on the distribution if you choose it. Free tax prep Distribution received by you. Free tax prep   If you receive a distribution that qualifies to be rolled over, you can roll over all or any part of the distribution. Free tax prep Generally, you will receive only 80% of the distribution because 20% must be withheld. Free tax prep If you roll over only the 80% you receive, you must pay tax on the 20% you did not roll over. Free tax prep You can replace the 20% that was withheld with other money within the 60-day period to make a 100% rollover. Free tax prep Voluntary deductible contributions. Free tax prep   For tax years 1982 through 1986, employees could make deductible contributions to a 403(b) plan under the individual retirement arrangement (IRA) rules instead of deducting contributions to a traditional IRA. Free tax prep   If you made voluntary deductible contributions to a 403(b) plan under these traditional IRA rules, the distribution of all or part of the accumulated deductible contributions may be rolled over if it otherwise qualifies as a distribution you can roll over. Free tax prep Accumulated deductible contributions are the deductible contributions: Plus Income allocable to the contributions, Gain allocable to the contributions, and Minus Expenses and losses allocable to the contributions, and Distributions from the contributions, income, or gain. Free tax prep Excess employer contributions. Free tax prep   The portion of a distribution from a 403(b) plan transferred to a traditional IRA that was previously included in income as excess employer contributions (discussed earlier) is not an eligible rollover distribution. Free tax prep   Its transfer does not affect the rollover treatment of the eligible portion of the transferred amounts. Free tax prep However, the ineligible portion is subject to the traditional IRA contribution limits and may create an excess IRA contribution subject to a 6% excise tax (see chapter 1 of Publication 590). Free tax prep Qualified domestic relations order. Free tax prep   You may be able to roll over tax free all or any part of an eligible rollover distribution from a 403(b) plan that you receive under a qualified domestic relations order (QDRO). Free tax prep If you receive the interest in the 403(b) plan as an employee's spouse or former spouse under a QDRO, all of the rollover rules apply to you as if you were the employee. Free tax prep You can roll over your interest in the plan to a traditional IRA or another 403(b) plan. Free tax prep For more information on the treatment of an interest received under a QDRO, see Publication 575. Free tax prep Spouses of deceased employees. Free tax prep   If you are the spouse of a deceased employee, you can roll over the qualifying distribution attributable to the employee. Free tax prep You can make the rollover to any eligible retirement plan. Free tax prep   After you roll money and other property over from a 403(b) plan to an eligible retirement plan, and you take a distribution from that plan, you will not be eligible to receive the capital gain treatment or the special averaging treatment for the distribution. Free tax prep Second rollover. Free tax prep   If you roll over a qualifying distribution to a traditional IRA, you can, if certain conditions are satisfied, later roll the distribution into another 403(b) plan. Free tax prep For more information, see IRA as a holding account (conduit IRA) for rollovers to other eligible plans in chapter 1 of Publication 590. Free tax prep Nonspouse beneficiary. Free tax prep   A nonspouse beneficiary may make a direct rollover of a distribution from a 403(b) plan of a deceased participant if the rollover is a direct transfer to an inherited IRA established to receive the distribution. Free tax prep If the rollover is a direct trustee-to-trustee transfer to an IRA established to receive the distribution: The transfer will be treated as an eligible rollover distribution. Free tax prep The IRA will be considered an inherited account. Free tax prep The required minimum distribution rules that apply in instances where the participant dies before the entire interest is distributed will apply to the transferred IRA. Free tax prep    For more information on IRAs, see Publication 590. Free tax prep Frozen deposits. Free tax prep   The 60-day period usually allowed for completing a rollover is extended for any time that the amount distributed is a frozen deposit in a financial institution. Free tax prep The 60-day period cannot end earlier than 10 days after the deposit ceases to be a frozen deposit. Free tax prep   A frozen deposit is any deposit that on any day during the 60-day period cannot be withdrawn because: The financial institution is bankrupt or insolvent, or The state where the institution is located has placed limits on withdrawals because one or more banks in the state are (or are about to be) bankrupt or insolvent. Free tax prep Gift Tax If, by choosing or not choosing an election, or option, you provide an annuity for your beneficiary at or after your death, you may have made a taxable gift equal to the value of the annuity. Free tax prep Joint and survivor annuity. Free tax prep   If the gift is an interest in a joint and survivor annuity where only you and your spouse have the right to receive payments, the gift will generally be treated as qualifying for the unlimited marital deduction. Free tax prep More information. Free tax prep   For information on the gift tax, see Publication 559, Survivors, Executors, and Administrators. Free tax prep Prev  Up  Next   Home   More Online Publications