Information on 401(k) Rollover to an IRA

Gather Your Statements

When planning your 401(k) transfer it is important to gather all of your paperwork first. Gather your most recent 401(k) statements and locate your account number and account balance. You will need this information to start the 401(k) transfer process. Once you have that documentation in place, you are ready to roll those funds into a self-directed IRA. It is a good idea to open a new IRA, rather than use an existing one, since this allows you to keep track of those old 401(k) funds and how they perform in the future.

As soon as you know you will be rolling over your 401(k,) you should establish a new shell account with the administrator you plan to use for the rollover IRA. You do not need to put any money into the account. You simply need to open the account and receive your account number. Once you have that account number, you can continue with the rollover process.

After the shell account is set up, you should contact the administrator of the rollover IRA and request a transfer form. Let the new administrator know that you are rolling over an existing 401(k.) When you receive the form, fill it out completely, including the account number for your 401(k), your full name and the name of the 401(k) plan administrator. Include a copy of your most recent 401(k) statement as well, since that can make it easier for the IRA administrator to initiate the transfer.

It is important to follow up and make sure your direct 401(k) rollover goes through without delay. If you do not receive confirmation of your IRA rollover within two weeks, contact the IRA administrator and request a status update. You should receive a confirmation statement once the transfer is complete, and you should keep this statement with your tax paperwork. Having that rollover confirmation on hand will make it easier to document the steps you took if the IRS has questions later on.