60 Day Rollover Options

Submitted by Matt Mason on Fri, 2024-03-08 20:01

I have a client that needs access to funds, of which they could plan to place part/all back within 60 days.

Situation:

IRA – $100,000

Roth IRA – $50,000

If they took out the entire balance of both or $150,000.  I think my understanding is they can only place one transaction of funds back into either account and not both.  i.e. They could replace up to $100,000 back into the IRA or up to $50,000 back into the Roth IRA, but they couldn’t do both.  And with either choice they can only do it once, i.e. in one check/ transaction going back in and not $25,000 in one week and $25,000 the next week.

Thanks for your additional clarification.

Matt



Submitted by Matt Mason on Fri, 2024-03-08 20:21

One additional point.  Within this scenario, if the IRA funds were actually within two IRA’s say $30,000 & $70,000 and taken in whole on the same day.  I presume being two separate accounts only one could amount could be replaced within the 60 day rollover rule.

Submitted by David Mertz on Fri, 2024-03-08 21:39

Only one of the distributions is permitted to be rolled over, but the rollover of that one distribution can be comprised of more than one deposits.  Two IRAs can be combined into one by nonreportable trustee-to-trustee transfer before taking a single distribution.  If $100,000 is taken from a traditional IRA and $50,000 is taken from the Roth IRA, one could roll over the $50,000 and convert the $100,000 to Roth without violating the rollover limitation, but of course the Roth conversion would be taxable.

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