A rollover is generally a tax free reinvestment of a distribution of a qualified plan into an IRA or other qualified plan with a specific time frame, usually 60 days. A rollover may take place when leaving a job at an employer who offered a retirement plan such as a 401(k). The company may issue a check for the amount minus 20% in withheld taxes. To avoid a tax penalty, the rollover must be done trustee to trustee, which means the check is made out to the new custodian or trustee of the rollover IRA. The company may provide a check which must be deposited into the new account within 60 days.
In addition to rolling over your 401(k) to an IRA, there are other options. For additional information and what is suitable for your particular situation please consult us.