What's the rationale behind the IRA One-Rollover-Per-Year Rule (mirror) in the United States, which was introduced in 2015?

I cannot think of any reason to limit the number of IRA rollovers to a maximum of 1 in any 12-month period.

  • The link in the OP includes this line: "Internal Revenue Code Section 408(d)(3)(B) limits taxpayers to one IRA-to-IRA rollover in any 12-month period" so it appears to be statutory. Interrogating the rationale of any specific law is a political question. – user662852 Jun 29 '18 at 4:02
  • @user662852 Political decisions typically aren't groundless. – Franck Dernoncourt Jun 29 '18 at 4:16
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    Note that the one rollover per year rule didn't start in 2015. It has existed for decades. But before 2015, it was interpreted as only applying on an IRA-by-IRA basis, so you could still do more than one rollover per year, as long as they were in different IRA accounts. In 2014, a tax court ruling ruled that it applied to all IRA accounts together, so starting in 2015, you could no longer do more than one rollover per year, even if they were in different IRA accounts. – user102008 Jun 30 '18 at 18:43

I found this interesting explanation from IRA Rollover Rules Changed for 2015 - Grossman Yanak & Ford LLP :

The old rules were widely known and were often used as an income tax-planning technique to provide a tax-free, penalty-free loan to a taxpayer if the taxpayer had a number of separate IRAs

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