Rollovers vs. Transfers
Sometimes qualified retirement plan participants may want to rollover or transfer the assets in their current plan to another qualified plan or to an IRA. Rollovers and transfers differ both procedurally and in their tax consequences.
A rollover is when the individual takes the retirement distribution (i.e., the funds) into their own personal possession and then looks for a new broker/company to invest the funds. This usually occurs when an employee leaves one job and takes his pension or accumulated account in one lump sum when he leaves.
The IRS gives account holders 60 days to complete the rollover. For company-managed qualified plans, the company must withhold 20% of the distribution as