Personal Finance & Estate › Retirement accounts & pensions › Individual Retirement Account (traditional IRA)
Rollovers & direct transfers
60-day rule· Tax rule
Law or rule (2026)Set by statute, regulation or the agency; numbers change yearly.
Moving retirement money between accounts, such as an old 401(k) into an IRA, without triggering tax.
See it on the Personal Finance & Estate map →How it works
A direct rollover or trustee-to-trustee transfer sends money account to account: no tax, and no limit on how often. An indirect rollover pays you first. From a 401(k), 20% is withheld, and you must redeposit the full amount, including that 20%, within 60 days, or the shortfall is taxed (plus 10% if under 59½). Only one IRA-to-IRA indirect rollover is allowed per 12 months. Ask your CPA first if you hold company stock or might use the age-55 rule.
Why it matters for you
Most old-job money moves by rollover; it is where costly, irreversible tax mistakes happen and a favorite opening for high-fee product sales.
Rules, limits and sources (2026)
IRC Secs. 402(c) and 408(d)(3); the IRS rollover chart; Bobrow v. Commissioner (Tax Court, 2014) applied the one-per-year limit across all of a person's IRAs.
Watch out for
Whether rolling to an IRA beats leaving money in the old plan depends on fees, investments and creditor protection; regulators keep scrutinizing rollover advice.
Connections (2)
▸Rollovers & direct transfers move old-job money into Individual Retirement Account (traditional IRA)Law or rule (2026)
How they connect
When people leave a job, a direct rollover moves the old 401(k) or 403(b) balance into an IRA with no tax, giving wider investment choices and one place to manage money. Pre-tax money goes to a traditional IRA, Roth money to a Roth IRA. Staying in the plan or moving to a new employer's plan are alternatives.
When it applies
Happens at job changes and retirement; the plan sends funds straight to the IRA custodian, ideally never through the owner's bank account.
The rule
IRC Sec. 402(c); plans must give a written rollover notice under Sec. 402(f); the IRS rollover chart.
Watch out for
Whether a rollover beats staying put depends on fees, creditor protection and the age-55 rule; advisers paid on IRA assets have a conflict.
▸Rollovers & direct transfers trigger advice rules under Fiduciary duty vs. suitability (Reg BI)Law or rule (2026)
How they connect
Moving a 401(k) into an IRA is often a retiree's largest money decision, and the person recommending it usually earns more afterward. Reg BI requires a broker's rollover recommendation to be in the customer's best interest, and Labor Department rules require firms to document why moving beats staying put.
When it applies
At retirement or a job change; SEC Reg BI took effect in 2020, and the Labor Department's rollover documentation rule under PTE 2020-02 in 2022.
The rule
SEC staff guidance on account recommendations (2022), FINRA Regulatory Notice 13-45 and the Labor Department exemption all name rollovers as a high-conflict moment.
Watch out for
How far fiduciary duty should reach for one-time rollover advice is still litigated; the Labor Department's 2024 rule was stayed by Texas federal courts.