Move retirement money with fewer costly mistakes.

An IRA rollover is the process of moving retirement funds from an employer-sponsored plan (like a 401k) into an Individual Retirement Account (IRA). Tax treatment depends on account types and whether rollover rules are followed. A properly handled direct rollover between compatible account types is generally designed to avoid current taxation.

For many indirect rollovers, you generally have 60 days from the date you receive a distribution to deposit it into another qualified account. Miss that window and the IRS may treat it as taxable income, with a possible 10% early distribution penalty if you are under 59½.

For most people, yes. A direct rollover (custodian-to-custodian transfer) means the money does not pass through your personal bank account, which helps avoid mandatory withholding and reduces the risk of missing the 60-day deadline.

A direct rollover from a traditional 401(k) to a traditional IRA is generally designed to avoid current taxation when handled correctly. Rolling pre-tax money to a Roth IRA is generally a taxable conversion. Always consult a qualified tax professional for your situation.