Author Topic: Indirect rollover to IRA - help!  (Read 1393 times)

MVal

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Indirect rollover to IRA - help!
« on: May 12, 2017, 01:36:01 PM »
An old job of mine distributed the funds in my old 401  and 457 account to me recently in a couple of checks, showing the amount withheld for taxes and then the checks were for the net distribution. I'm sending a check to Vanguard to add this money to my IRA as an indirect rollover, but I'm confused as to whether I write a check for the gross amount or the net??

They already told me they would automatically send a 5498 form to the IRA for the rollover. I asked them this question and they said "ask your tax professional."

Bobberth

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Re: Indirect rollover to IRA - help!
« Reply #1 on: May 12, 2017, 01:51:01 PM »
If you don't pay out of pocket for the taxes withheld, the withholding becomes a distribution and is considered taxable income with the possibility of early withdrawal penalties depending on your age.