Eligible Rollover Distribution


Also found in: Acronyms.

Eligible Rollover Distribution

The amount of money in an IRA or other qualified retirement plan that may be rolled over into another plan. Rollovers occur most often when a person changes employers; they may occur without penalty once per year.
References in periodicals archive ?
A plan that permits IPRCs must include a description of this feature in the written explanation the plan provides to an individual receiving an eligible rollover distribution.
For example, if an employer plan distributes $50,000 to an employee (E) during 2009 that is an eligible rollover distribution, but would have been a 2009 RMD, the plan is permitted, but not required, to offer E a direct rollover of this $50,000 and provide E with a written explanation of the requirements.
Under current law, an eligible rollover distribution received from a qualified plan may be rolled over tax free as long as the rollover is made within 60 days of the distribution.
tax purposes, it does not provide an independent basis for treating a transfer as an eligible rollover distribution.
The disadvantage of a 60-day rollover is that the distributing plan must withhold 20% of the eligible rollover distribution for federal income tax purposes (see Sec.
408A to allow the recipient of an eligible rollover distribution not made from a designated Roth account to roll over the amount of the distribution to a Roth IRA without first contributing that amount to a non-Roth IRA.
402(c)(2):The portion of an eligible rollover distribution not otherwise includible in gross income cannot be rolled over; unless such previously taxed amounts are transferred to an IRA or a qualified defined contribution plan that agrees to separately account for such amounts in a direct trustee-to-trustee transfer.
A SESOP that holds S stock and permits distributions of employer securities must permit participants to elect to have any eligible rollover distribution of S stock be paid directly to an eligible retirement plan, including an IRA.
402(c)(1), any portion of an eligible rollover distribution from a qualified Sec.
Qualified plans (including ESOPs) permit participants receiving an eligible rollover distribution to roll it over directly to an eligible retirement plan, including an IRA.
401(a) plan to allow participants to elect to have an eligible rollover distribution paid directly to an eligible retirement plan specified by the participant.
402(c)(1) allows an individual to receive an eligible rollover distribution from a qualified retirement trust without being subject to current income taxation or premature distribution penalties, if he transfers such distribution to another eligible retirement plan, such as an individual retirement account (IRA), within the 60-day period beginning on the distribution receipt date.