Direct rollover to Roth IRA

Submitted by Peter Thomann on Tue, 2019-11-05 11:56

Is a retirement plan provider required to offer a direct rollover to a Roth IRA? If yes, what law requires it?
Thank you.



Submitted by William Tuttle on Tue, 2019-11-05 13:29

  • 26 CFR § 1.401(a)(31)-1 – Requirement to offer direct rollover of eligible rollover distributions; questions and answers.

Submitted by Alan - IRA critic on Tue, 2019-11-05 16:01

Note that the Q and As of the above Reg provide considerable detail. For example, the plan is allowed to deny direct rollovers for certain minimum amounts, usually 500 or less. And while plans must split a distribution between a direct rollover and a portion being paid directly to the participant, a plan is NOT required to provide multiple direct rollovers, not even the split rollovers outlined in Notice 2014-54, or direct rollovers specifying a portion to your Roth IRA at Vanguard and the rest to your Roth IRA as Schwab. Most plans are reasonably accomodating, but are not required to offer more than the Reg requires.

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