How to Transfer or Rollover to a Self-Directed IRA

IRA Transfer & 401(k) Rollover FAQs

What is a rollover IRA?

A rollover IRA is an IRA that receives eligible funds or assets rolled over from another retirement account, commonly an employer-sponsored plan such as a 401(k). A direct rollover moves the funds from the employer plan to the IRA custodian. This often happens after you leave a job or retire.

Is a rollover IRA a Traditional IRA?

A rollover IRA usually refers to a Traditional IRA funded with assets from an employer-sponsored retirement plan. If your 401(k) includes both pretax funds and a designated Roth account, you can generally roll the pretax portion into a Traditional IRA and the Roth portion into a Roth IRA. This would involve two accounts: a Traditional IRA and a Roth IRA.

Can I roll over a 401(k) to a Roth IRA?

Yes. Eligible 401(k) funds can roll directly into a Roth IRA without first passing through a Traditional IRA. Previously untaxed amounts are generally included in your taxable income for the year. A properly completed direct rollover from a designated Roth 401(k) account to a Roth IRA generally does not create additional taxable income.

How do I transfer a 401(k) to an IRA?

Moving eligible 401(k) funds to an IRA is called a rollover. First, open or establish an IRA at IRAR and complete our Rollover Certification Form. Then, contact your plan administrator to confirm eligibility and request a direct rollover to your new IRA. Leaving a job commonly makes funds eligible, although some plans also allow eligible distributions while you are still employed.

How do I transfer an IRA from one institution to another?

First, open an IRA at the institution receiving the funds. At IRAR, complete the New Account Application and Transfer Form, and provide the required identification and a recent statement from your current IRA. IRAR will send the transfer request to your current custodian to begin moving the funds or accepted assets directly to your new account.

What is the difference between a transfer and a rollover?

A transfer moves funds directly from one IRA custodian to another IRA custodian. A rollover can move eligible funds from an employer-sponsored plan, such as a 401(k), to an IRA, either directly or through a distribution paid to you. IRA-to-IRA movements can also be rollovers when you receive the funds and redeposit them within the applicable deadline.

What is the deadline to complete a rollover?

If an eligible retirement distribution is paid to you, you generally have 60 days from the date you receive funds to deposit them into an eligible retirement account. Missing the deadline can result in taxes and possible early withdrawal penalties unless an exception or waiver applies. A direct rollover avoids this personal redeposit deadline because the payment goes to the receiving account.

Do transfers trigger tax consequences?

Generally, IRA-to-IRA transfers do not trigger taxes when funds move directly between custodians and retain the same tax treatment, such as Traditional IRA to Traditional IRA or Roth IRA to Roth IRA. Moving pretax Traditional IRA funds to a Roth IRA is a conversion and generally creates taxable income, even when handled directly between custodians.

Are there limits on IRA-to-IRA transfers or movements of funds?

No. Trustee-to-trustee transfers have no limit on how often they can occur. However, you generally can complete only one 60-day rollover per 12-month period between your IRAs, counting all your IRAs together. This restriction does not apply to direct transfers, Roth conversions, or rollovers from employer plans such as 401(k)s to IRAs.

How do I move an IRA to a Self-Directed IRA?

First, open a Self-Directed IRA at IRAR with the appropriate tax treatment, such as Traditional or Roth. Then arrange a direct transfer or rollover, depending on the account you are moving funds from. For an existing IRA, a direct custodian-to-custodian transfer generally avoids the 60-day rollover rules. Moving to a Self-Directed IRA is not itself a Roth conversion. Once funded, you can select investments accepted by the custodian and permitted under IRA rules.

Can I roll my 401(k) into a Self-Directed IRA?

Yes, if your plan allows an eligible distribution. A 401(k) rollover can move eligible retirement savings into a Self-Directed IRA, commonly after you leave a job. Properly rolling pretax funds into a Traditional Self-Directed IRA generally avoids current taxes and early withdrawal penalties. Rolling pretax funds into a Roth Self-Directed IRA generally creates taxable income.

Can I move my IRA to a Self-Directed IRA?

Yes. You can move your Traditional or Roth IRA to a Self-Directed IRA through a direct custodian-to-custodian transfer. A Traditional-to-Traditional or Roth-to-Roth transfer generally does not create taxable income and does not count toward the once-per-year IRA rollover limit.

IRA transfer vs. rollover

The distinction depends on the accounts involved and how the funds move. An IRA transfer moves funds directly between IRA custodians and generally is not reported as a distribution. An IRA rollover can involve receiving an IRA distribution and redepositing it within 60 days, subject to the once-per-12-month limit. Employer-plan rollovers can be direct or indirect and are generally reportable even when no tax is owed.

How do I roll over a 401(k)?

Open the receiving IRA, then contact your plan administrator to confirm eligibility and request a direct rollover. Follow the receiving custodian’s payment instructions so the funds are payable to your IRA rather than to you personally. A direct rollover avoids mandatory withholding, but rolling pretax funds into a Roth IRA generally creates taxable income. Once the funds are available, you can choose investments permitted by your IRA and custodian.