COURT'S FAILURE TO COMPLY WITH INTERNAL REVENUE CODE
THE COURT'S FAILURE TO COMPLY WITH INTERNAL REVENUE CODE, AS IT PERTAINS TO ILLEGALLY SEIZED RETIREMENT ACCOUNT ASSETS
The United States Congress has expressed a deep and continuing interest in the preservation of pension plans, and in encouraging retirement savings, as reflected in the statutes which have created ERISA, Keogh plans, and IRAs. Wolff v. Gibson (In re Gibson), 300 B.R. 866, 867. The court then went on to further state that given the language and purpose of §11-504(h), the court finds that the exemption status of a qualified retirement plan did not expire immediately upon distribution, but rather remained in effect pending a rollover into an IRA within the 60-day time period allocated under the Internal Revenue Code. Id. at 871.
Pursuant to the Internal Revenue Code, funds withdrawn from a qualified pension plan are entitled to tax exempt status for a period of 60 days. 26 U.S.C.S. §402(c); 26 U.S.C.S. §402(c)(3)(A). If, within 60 days, the funds are rolled into another qualified plan, the tax exempt status remains intact. Id. at 866, 867.
Courts have consistently ruled that withdrawn funds from qualified pension plans, Keogh plans, and IRAs are essentially to be treated as if they were never withdrawn in the first place- throughout the 60-day grace period granted under the Internal Revenue Code.
The Internal Revenue Code is certainly the supreme law of the land, and as such, the Racine court erred in preventing Larsen, and/or Larsen's Power of Attorney, from returning said funds to another qualified plan, or to the accounts from whence they came.
The Racine court did further harm to Larsen by virtue of the fact that its ILLEGAL WHOLESALE SEIZURE then caused numerous taxes and penalties to be incurred, which otherwise would not have been incurred if Larsen had been allowed to exercise his rights pursuant to Internal Revenue Code §402(c)(3).
The Racine court's Order not to transfer violated Larsen's rights under 26 U.S.C.S. §402(c)(3), as well as under the Employee Retirement Income Security Act (ERISA). Larsen's Power of Attorney had 60 days per the Internal Revenue Code to return funds to a retirement vehicle, but the Racine court very purposefully prevented this from occurring through its ILLEGAL WHOLESALE SEIZURE. The court is BARRED from any action per the anti-forfeiture and anti-alienation clauses of the Employee Retirement Income Security Act (ERISA). State v. Kenyon, 225 Wis.2d 657. These illegally seized assets of Larsen, should never have been in the hands or control of the Racine court, or their Receiver. The fraudulent method by which the Racine court chose to tie-up Larsen's funds was illegal and reprehensible.
Larsen and Larsen's Power of Attorney wanted said funds returned to the retirement vehicle from whence they came. The circuit court judge, in direct violation of Internal Revenue Code 402(c)(3), prevented Larsen's Power of Attorney from exercising his duties pursuant to that Code.² Larsen had 60 days, per that Code, to return said funds and was ONLY prevented from doing so by the Racine Court itself. Larsen was well within that 60-day time frame when the Racine Court illegally seized his funds. Even if that time frame had passed, the hardship exception certainly would have applied and been granted by the Secretary anyway, as this ILLEGAL WHOLESALE SEIZURE was certainly an "event beyond the reasonable control of the individual subject to the requirement".
All funds could have been very easily and properly returned to the accounts from whence they came. Larsen's Social-Security Number certainly did not cease to exist, nor did the Federal Aviation Administration's Thrift Savings Plan. The same is true with regard to the Fidelity Roth IRA- Account #183-29****. The account was never closed, as funds were only withdrawn for the sake of obtaining necessary legal counsel, which the Racine Court then prevented from being retained. The original account to this day still exists and has an approximate value of about $50.00.
The state court receiver had a responsibility to treat Larsen's retirement assets as such, yet he did not. The state court receiver failed to place Larsen's funds within any type of a retirement vehicle himself, even though he was fully aware of the fact that these were ENTIRELY retirement assets, as can be seen from various court records and transcripts. He apparently thought it sufficient to just separate these funds by separate accounts, as opposed to placing them directly into a retirement vehicle as has should have occurred.
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²Larsen's father, as Power of Attorney, was directly threatened with contempt charges by the Racine court if he did not turn over Larsen's funds to the court/receiver.