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taxmap/pub17/p17-055.htm#TXMP56f3c342 Rollovers(p75)

If you withdraw cash or other assets from a qualified retirement plan in an eligible rollover distribution, you can defer tax on the distribution by rolling it over to another qualified retirement plan or a traditional IRA.

For this purpose, the following plans are qualified retirement plans.

• A qualified employee plan.
• A qualified employee annuity.
• A tax-sheltered annuity plan (403(b) plan).
• An eligible state or local government section 457 deferred compensation plan.

See Rollovers to Roth IRAs under Rollovers in Publication 575, for information on rollovers after 2007 from a qualified retirement plan to a Roth IRA.

taxmap/pub17/p17-055.htm#TXMP45123b51 Time for making rollover.(p75)

You generally must complete the rollover by the 60th day following the day on which you receive the distribution from your employer's plan. (This 60-day period is extended for the period during which the distribution is in a frozen deposit in a financial institution.) For all rollovers to an IRA, you must irrevocably elect rollover treatment by written notice to the trustee or issuer of the IRA.

The IRS may waive the 60-day requirement where the failure to do so would be against equity or good conscience, such as in the event of a casualty, disaster, or other event beyond your reasonable control.

taxmap/pub17/p17-055.htm#TXMP0730e99b Eligible rollover distributions.(p75)

Generally, an eligible rollover distribution is any distribution of all or the balance to your credit in a qualified retirement plan. For information about exceptions to eligible rollover distributions, see Publication 575.

taxmap/pub17/p17-055.htm#TXMP730be00c Rollover of nontaxable amounts.(p75)

You may be able to roll over the nontaxable part of a distribution (such as your after-tax contributions) made to another qualified retirement plan that is a qualified employee plan or a 403(b) plan, or to a traditional IRA. The transfer must be made either through a direct rollover to a qualified plan or 403(b) plan that separately accounts for the taxable and nontaxable parts of the rollover or through a rollover to a traditional IRA.

If you roll over only part of a distribution that includes both taxable and nontaxable amounts, the amount you roll over is treated as coming first from the taxable part of the distribution.

taxmap/pub17/p17-055.htm#TXMP4a8b3efc Designated Roth accounts.(p75)

You can roll over an eligible rollover distribution from a designated Roth account only into another designated Roth account or a Roth IRA. If you want to roll over the part of the distribution that is not included in income, you must make a direct rollover of the entire distribution or you can roll over the entire amount (or any portion) to a Roth IRA. For more information on rollovers from designated Roth accounts, see Publication 575.

taxmap/pub17/p17-055.htm#TXMP7c702f12 Direct rollover option.(p75)

You can choose to have any part or all of an eligible rollover distribution paid directly to another qualified plan (if permitted) or to a traditional IRA. If you decide on a rollover, it is generally to your advantage to choose this direct rollover option. Under this option, the plan administrator would not withhold tax from any part of the distribution that is directly paid to the other plan.

taxmap/pub17/p17-055.htm#TXMP694e6beb Withholding tax.(p75)

If you choose to have all or any part of the distribution paid to you, it is taxable in the year distributed unless you roll it over to another qualified plan or to a traditional IRA within 60 days. The plan administrator must withhold income tax of 20% from the amount of the distribution paid to you. (See Pensions and Annuities under Withholding in chapter 4.)

If you decide to roll over an amount equal to the distribution before withholding, your contribution to the new plan or IRA must include other money (for example, from savings or amounts borrowed) to replace the amount withheld.

The administrator must give you a written explanation of your distribution options within a reasonable period of time before making an eligible rollover distribution.

taxmap/pub17/p17-055.htm#TXMP73beb541 Rollover by surviving spouse.(p76)

You may be able to roll over tax free all or part of a distribution from a qualified retirement plan you receive as the surviving spouse of a deceased employee. The rollover rules apply to you as if you were the employee. You can roll over a distribution into a qualified retirement plan or a traditional IRA.

A distribution paid to a beneficiary other than the employee's surviving spouse is generally not an eligible rollover distribution. However, see Rollovers by nonspouse beneficiary, next.

taxmap/pub17/p17-055.htm#TXMP39d21fda Rollovers by nonspouse beneficiary.(p76)

If you are a designated beneficiary (other than a surviving spouse) of a deceased employee, you may be able to roll over tax free all or a portion of a distribution you receive from an eligible retirement plan of the employee. The distribution must be a direct trustee-to-trustee transfer to your IRA that was set up to receive the distribution. The transfer will be treated as an eligible rollover distribution and the receiving plan will be treated as an inherited IRA. For information on inherited IRAs, see Publication 590.

taxmap/pub17/p17-055.htm#TXMP3fc7e42f Qualified domestic relations order (QDRO).(p76)

You may be able to roll over tax free all or part of a distribution from a qualified retirement plan that you receive under a QDRO. If you receive the distribution as an employee's spouse or former spouse (not as a nonspousal beneficiary), the rollover rules apply to you as if you were the employee. You can roll over the distribution from the plan into a traditional IRA or to another eligible retirement plan. See Publication 575 for more information on benefits received under a QDRO.

taxmap/pub17/p17-055.htm#TXMP5d664506 Retirement bonds.(p76)

If you redeem a retirement bond purchased under a qualified bond purchase plan, you can defer the tax on the amount received that exceeds your basis by rolling it over to an IRA as discussed in Publication 590 or qualified employer plan.

taxmap/pub17/p17-055.htm#TXMP75bc6d7b More information.(p76)

For more information on the rules for rolling over distributions, see Publication 575.

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