Generally, a rollover is a tax-free distribution to you from a previous retirement plan or IRA that you transfer to another retirement plan or IRA. A rollover does not count towards the annual IRA contribution limit and it is not a deductible contribution.
The Traditional NYCE IRA will accept rollovers from a previous employer's retirement plan and the City's 457 Plan and or pre-tax 401(k) Plan and 403(b) after severance from City service or attainment of age 59½ (401(k) and 403(b)). In addition, the Traditional NYCE IRA is the perfect place to consolidate your other traditional IRAs.
The only distributions from a pre-tax retirement plan or traditional IRA that are not eligible for rollover to the Traditional NYCE IRA are the following:
After establishing a Traditional NYCE IRA, rolling over assets from a previous retirement plan or IRA is simple:
Traditional NYCE IRA
FBO: <your full name and last four digits of your Social Security Number>
Direct them to mail the check to:
P.O. Box 392057
Pittsburg, PA 15251-9057
If the distribution you received from the previous pre-tax retirement plan was made payable to you, you can still roll it over to the Traditional NYCE IRA, however, 20% of your eligible retirement plan distribution was withheld for federal income taxes. In order to roll over 100% of the distribution, you will have to use your own savings to replace the 20% that was withheld. The NYCE IRA administrative office must receive a check from you within 60 days of your receipt of the distribution in order for you to receive credit for the 20% that was withheld toward your income tax return. However, if you don't have the cash to make up for the 20% withheld, and only roll over the 80% of your plan distribution that you received, the IRS will consider that 20% as a distribution, making it subject to taxes and a possible 10% early withdrawal penalty.
The only way to avoid this withholding is to have your previous retirement plan make your distribution check payable to to the Traditional NYCE IRA.
Upon receipt of the Incoming Rollover Form and the funds, you will receive a NYCE IRA confirmation letter. The assets will be invested in accordance with the investment allocation selected at the time you set up your Traditional NYCE IRA account. See Selecting Your Investments to learn more about your available investment options.