60 day rollover rule
Client wishes to use the 60-day rule to move money to a new IRA. 99% of the funds were sent via check but were told there may be as much as $200-300 that would be sent once the existing account is closed. Will these funds be included with the initial funds as a part of the 60-day rollover?
Permalink Submitted by Alan - IRA critic on Wed, 2024-05-29 15:38
No. Since the distributions are on different days and only one of them can be rolled over (the one already received), her options for the final small amount are limited to moving them to the new IRA by direct transfer rather than distribution, or if receiving a distribution it could be converted to Roth (tax but no penalty), or just kept in taxable (tax plus penalty). If any income taxes were withheld, to have a complete rollover she would have to replace the withholding with other funds.