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Rollover IRA

Plan Description

• A Rollover IRA is an IRA established to accept a tax-free distribution from a qualified plan or 403(b).
• There are 2 kinds of rollovers: rollovers you receive in cash from a Traditional IRA, qualified plan, or 403(b); and direct rollovers, where the distributions are made payable to the custodian of the accepting IRA.
• To establish a separate Rollover IRA without co-mingling other IRA assets, you have the option to roll over your Rollover IRA assets to another qualified plan or 403(b) at a later date.

• Rollovers: Any eligible rollover distribution from a qualified plan or 403(b) that is reinvested in a Rollover IRA within 60 days of receipt. To avoid the mandatory 20% withholding, you may want to utilize direct rollover procedures. Rollovers are also distributions from one IRA that are reinvested within 60 days to another IRA. (These IRA to IRA rollovers can only be made in any one-year period. This rule applies separately to each IRA you own.)
• Direct Rollovers: Any distribution from a qualified plan or 403(b) that is eligible to roll over and is made payable to the custodian of the accepting Rollover IRA. Direct rollover procedures avoid the 20% mandatory withholding.