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Is the following example an eligible rollover in the eyes of the IRS?
My retirement plan writes a monthly check payable to my bank to deposit on my behalf. Is this rollover-eligible and will tax be withheld on the checks?
(My bank deposits the checks into an IRA)
4 Answers
- R TLv 78 years agoFavorite Answer
If it goes into one of your accounts, it's a disbursment and subject to tax. A rollover must be between two qualified investments and you can't be able to spend it.
Source(s): /// - Richard AndersonLv 68 years ago
As long as it's a qualified IRA there is no tax obligation until you withdraw the money after age 59 1/2.
- kelby7670Lv 78 years ago
The concept of a monthly rollover seems strange, but if that's what happens, it would not be taxable if it went right from your retirement plan to the bank
- troLv 78 years ago
of course not, these monthly payments are distribution that you have access to
a rollover would be from one bank to another, you never touching the money
the deposits to your bank account are available for you to use, they are no longer in an IRA account
and if you elected to have income tax withheld with each distribution, that was your choice
