401k - Rather than paying ordinary income tax on your entire retirement plan distribution you might consider a more versatile and attractive strategy: rolling some or all of the distribution into an IRA or another employers plan.
A rollover is usually accomplished by having your employer transfer your funds directly to another employers plan or an IRA Rollover through a transaction called direct rollover. If the funds are distributed directly to you, however, you have 60 days to deposit them into another plan or an IRA. The portion that is rolled over will continue to be tax deferred and will be subject to all the rules of the new plan or IRA Rollover. Any portion that is not rolled over with 60 days will be subject to ordinary income tax. 401k
(tip) rollovers into another qualified plan after retirement are unusual. This is because once a person retires, he or she probably doesn’t have another plan. Distributions at retirement are usually rolled into an IRA, unless you are taking your benefints as an annuity, in which case no rollover of any kind is permitted.
Who is eligible?
Anyone who receives a distribution from a qualified plan or qualified annuity is permitted to roll it over. It doesn’t matter how old you are or how long you have been participant in the plan.