IRA distributions were taxable. A man took nearly $45,000 in withdrawals from his wife’s IRA during their divorce “out of fear for his daughter’s financial future.” Although he claimed to have made a tax-free rollover into an irrevocable trust, the U.S. Tax Court disagreed. The taxpayer didn’t show that the funds actually went into the trust; that he’d completed the rollover within the requisite 60 days; and that the trust was a qualified retirement account. Moreover, he admitted that the trust was for his daughter’s, not his wife’s, benefit. (TC Memo 2016-210)
