Rolling Over a 401(k) When You Retire or Change Jobs: What the IRS's New Sample Forms Mean

Reviewed by Herman Schroeder, CFA

Educational article, not personal advice

As of October 20, 2026.

The short answer

On August 12, 2026 the IRS released IR-2026-91 and Notice 2026-49, which propose standard sample forms to make moving money from a workplace plan to an IRA or a new plan simpler. Using them is optional for plan sponsors, and public comments are due October 23, 2026. The rules that decide whether a rollover is taxed have not changed, so the safest route is still a direct rollover, not a check made out to you.

What did the IRS announce?

IR-2026-91 says Treasury and the IRS issued sample forms for direct rollovers to or from a retirement plan, as SECURE 2.0 section 324 requires. The forms cover rollovers between plans, or between a plan and an IRA. They do not cover IRA-to-IRA transfers. Using them is optional for plan sponsors.

We are writing from this August release because nothing in the IRS newsroom this week speaks as directly to people retiring, changing jobs, or leaving a company with stock in their plan. It still applies because the comment window is open until October 23, and the rollover rules it sits on are the ones in force today.

Notice 2026-49 also lists ideas the IRS is weighing for later. These include ending paper checks sent to participants for direct rollovers, and saying that plans cannot demand a Medallion Signature Guarantee or other burdensome paperwork. Those are proposals, not rules yet.

Which rollover methods does the IRS describe?

  • Direct rollover (from a plan) - How the money moves: Plan pays the new plan or IRA directly; Tax withheld?: No; IRS source: IRS, Rollovers of Retirement Plan and IRA Distributions

  • Trustee-to-trustee transfer (from an IRA) - How the money moves: IRA custodian pays the new IRA or plan directly; Tax withheld?: No; IRS source: IRS, Rollovers of Retirement Plan and IRA Distributions

  • 60-day rollover (from a plan) - How the money moves: Paid to you, you redeposit within 60 days; Tax withheld?: 20% mandatory; IRS source: IRS, Rollovers of Retirement Plan and IRA Distributions

  • 60-day rollover (from an IRA) - How the money moves: Paid to you, you redeposit within 60 days; Tax withheld?: 10% unless you elect out or choose another amount; IRS source: IRS, Rollovers of Retirement Plan and IRA Distributions

Why does a check made out to you cause trouble?

The IRS says a plan distribution paid to you has 20% withheld, even if you plan to roll it over. To roll over the full amount within 60 days, you have to make up the withheld part from other money.

The IRS gives this example on its rollover page:

  • Eligible rollover distribution from a 401(k) - Amount: $10,000; IRS source: IRS, Rollovers of Retirement Plan and IRA Distributions

  • Withheld by the employer (20%) - Amount: $2,000; IRS source: Same page

  • Rolled over within 60 days - Amount: $8,000; IRS source: Same page

  • Reported as taxable income - Amount: $2,000; IRS source: Same page

The math: $10,000 minus $2,000 withheld equals $8,000 rolled over. The $2,000 not rolled over is reported as taxable income, and the $2,000 withheld is reported as taxes paid. The IRS says the person in its example, age 42, must also pay the 10% additional tax on early distributions on that $2,000 unless an exception applies. To roll over the full $10,000 instead, you would have to add the $2,000 from other money within the 60 days. Then the whole $10,000 is a nontaxable rollover, the $2,000 withheld counts as taxes paid, and you avoid the 10% additional tax.

Ask for the direct rollover. A check made out to you is where most of the trouble starts.

What can't be rolled over?

The IRS lists distributions that are not eligible. The ones we see come up most around retirement are:

  • Required minimum distributions (RMDs)

  • Hardship distributions

  • Loans treated as a distribution

  • A series of substantially equal periodic payments

  • Dividends on employer securities

Source: IRS, Rollovers of Retirement Plan and IRA Distributions.

If you are taking RMDs, the required amount for the year comes out first and stays out. Only the rest can move.

Is there a limit on how often you can roll over an IRA?

Yes, for one kind of move. You can make only one IRA-to-IRA rollover in any 12-month period, counting all your IRAs together. The IRS says the limit does not apply to trustee-to-trustee transfers, plan-to-IRA rollovers, plan-to-plan rollovers, IRA-to-plan rollovers, or Roth conversions. If you break the rule, the amount can be taxed, and money put back into an IRA can be treated as an excess contribution taxed at 6% per year while it stays there. Source: IRS, Rollovers of Retirement Plan and IRA Distributions.

What if your 401(k) holds company stock?

This one matters for people who spent years at one employer. IRS Topic 412 says that when a lump-sum distribution includes employer securities and the payer reports net unrealized appreciation (NUA) on Form 1099-R, the NUA is generally not taxed until you sell the shares. Topic 412 also says that if you roll the distribution over, the regular IRA rules apply to later withdrawals and the special lump-sum rules no longer apply.

So the order of operations matters. Look at the company stock before you sign a rollover form, not after.

Moving the account is the easy part. Deciding what to own once it lands is the part that matters. For how we think about the years around retirement, see our retirees page (https://www.schroedercap.com/retirees).

Questions to ask before you move a retirement account

  • Can my old plan send the money directly to the new IRA or plan, by wire or a check payable to the new account?

  • If a check comes to me, is it payable to the new custodian or to me?

  • Do I have an RMD this year that has to come out first?

  • Does my plan hold company stock, and does the plan report NUA on it?

  • Have I done an IRA-to-IRA rollover in the last 12 months?

  • Does my plan ask for paperwork, such as a Medallion Signature Guarantee, that may slow things down?

  • Will the money land in cash, and what is the plan for it after that?

These are questions for a review of your household before any money moves.

Frequently asked questions

When did the IRS release the sample rollover forms?

August 12, 2026, in IR-2026-91 and Notice 2026-49. Source: IRS IR-2026-91.

Do plans have to use the new forms?

No. The release says use of the sample forms and proposed procedures is optional for plan sponsors. Source: IRS IR-2026-91.

When are comments due?

October 23, 2026. Source: IRS IR-2026-91 and Notice 2026-49.

How long do I have to finish a 60-day rollover?

60 days from the date you receive the distribution. The IRS may waive the deadline in some cases beyond your control. Source: IRS, Rollovers of Retirement Plan and IRA Distributions.

Can I have more than 20% withheld from a lump sum?

Yes. Topic 412 says the 20% default may be too low for your situation and you can give the payer Form W-4R to elect more. Source: IRS Topic 412.

For year-end tax framing across your accounts, see our tax planning page (https://www.schroedercap.com/tax-planning1).

Sources

Sources checked October 20, 2026. Rules and proposals can change. Check the IRS page for the year that applies to you.

Disclosures

This is general education, not advice on your return. It is not individualized tax or investment advice. Rollover rules depend on your plan's terms, your age, and your full tax situation, and Notice 2026-49 is a proposal that may change. Investing involves risk, including the possible loss of principal.

CFA® is a trademark owned by CFA Institute. Schroeder Capital Management, LLC is not affiliated with CFA Institute.