Individual Retirement Account Rollover

Individual Retirement Account Rollover means:
a provision of the Individual Retirement Account (IRA) law that enables a person receiving a lump-sum payment from his or her company's pension or profit-sharing plan because of retirement or other termination of employment to roll the amount over, tax free, into an IRA investment plan within 60 days. For distributions after 1992, unless the IRA funds are transferred directly to an eligible plan, the payor must withhold 20% of the distribution. If the participant then transfers only the remaining 80% to a new IRA, he or she will pay income tax and a penalty tax on the 20% withheld. Former IRC (check if this IRC provision is current here) §402(a)(5).

Individual Retirement Account (IRA)

See the entries Income Tax and State Income Tax in the American Encyclopedia of Law.