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Direct vs Indirect IRA Rollover

Compare direct rollovers, trustee-to-trustee transfers, and 60-day rollovers before moving retirement funds.

MethodWhat generally happensKey issue
Direct rolloverEmployer plan sends eligible funds directly to another plan or IRA.No mandatory 20% withholding on the directly rolled amount.
Trustee-to-trustee transferIRA institution sends funds directly to another IRA institution.No withholding from the transfer amount.
60-day rolloverYou receive the distribution and redeposit eligible funds.Deadline, withholding and one-rollover-per-year rules can become relevant depending on account type.
The word “indirect” is often used loosely. Use the IRS terminology for your exact account and transaction before acting.
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