What is the difference between a rollover and a transfer of assets?
A. A transfer is the movement of funds between like accounts, such as one Traditional IRA to another Traditional IRA. You can transfer assets as often as you like. Since no possession of assets occurs, transfers are not reported to the IRS. In contrast, a rollover is the movement of funds between one eligible retirement plan and another, such as a 401(k) to a Traditional IRA. All distributions are reported to the IRS and may be subject to federal income tax.
A rollover is the movement of funds between one eligible retirement plan and another such as movement from a 401(k) to a Rollover IRA. Distributions like this are reported to the IRS and may be subject to federal income tax. A transfer is the movement of funds between like accounts such as movement from one Traditional IRA to another Traditional IRA. Transfers can take place as often as you like. They are not reported to the IRS because you never take possession of your money.
