96 STAT. 522
PUBLIC LAW 97-248—SEPT. 3, 1982 (1) INDIVIDUAL RETIREMENT ACCOUNTS. — Paragraph (7) of
26 USC 408.
sec-
tion 408(a) (defining individual retirement account) is amended to read a s follows: "(7) I f "(A) a n individual for whose benefit the t r u s t is maintained dies before his e n t i r e interest has been distributed to him, or "(B) distribution has been commenced as provided in paragraph (6) to his surviving spouse and such surviving spouse dies before the e n t i r e interest has been distributed to such spouse, the e n t i r e interest (or the r e m a i n i n g part of such interest if distribution thereof has commenced) will be distributed within 5 years after his death (or the death of the surviving spouse). The preceding sentence shall not apply if distributions over a term certain commenced before the death of the individual for whose benefit the t r u s t was m a i n t a i n e d and the term certain is for a period permitted under paragraph (6)." (2) INDIVIDUAL RETIREMENT A N N U I T I E S. — Paragraph (4) of sec-
tion 408(b) (defining individual retirement annuity) is amended to read as follows: "(4) I f "(A) the owner dies before his e n t i r e interest has been distributed to h i m, or "(B) distribution has been commenced as provided in paragraph (3) to his surviving spouse and such surviving spouse dies before the e n t i r e interest has been distributed to such spouse, the e n t i r e interest (or the r e m a i n i n g part of such interest if distribution thereof has commenced) will be distributed within 5 years after his death (or the death of his surviving spouse). The preceding sentence shall not apply if distributions over a term certain commenced before the death of the owner and the term certain is for a period permitted under paragraph (3)." (b) T R E A T M E N T OF INHERITED INDIVIDUAL RETIREMENT (1) D E N I A L OF ROLLOVER T R E A T M E N T. —
PLANS.—
(A) Paragraph (3) of section 408(d) (defining rollover contributions) is amended by adding a t the end thereof the following new subparagraph: "(C) D E N I A L OF ROLLOVER ACCOUNTS, E T C. —
TREATMENT
FOR
INHERITED
"(i) IN GENERAL.—In the case of a n inherited individual retirement account or individual retirement annuity— "(I) this paragraph shall not apply to any a m o u n t received by a n individual from such an account or a n n u i t y (and no a m o u n t transferred from such account or a n n u i t y to a n other individual retirement account or a n n u i t y shall be excluded from gross income by reason of such transfer), and "(II) such inherited account or a n n u i t y shall not be t r e a t e d as a n individual retirement account or a n n u i t y for purposes of determining w h e the r any other a m o u n t is a rollover contribution. "(ii) INHERITED INDIVIDUAL RETIREMENT ACCOUNT OR
ANNUITY.—An individual retirement account or indi-
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