Have a situation where a participant has received a cash-out distribution, but wants to roll it over to another qualified plan.
First, he states he did not receive a 30-day notice regarding the distribution.
In a situation like this, what are the options?
My thinking is as follows:
1. If still within 30 days of receipt of check, contact prior employer and state he did not receive a notice and explain he wants a rollover. Perhaps they can reissue the check.
2. If #1 is not an option, then he can come up with the 20% from another source and roll over 100% within 60 days of receipt of check. When he does his taxes, he may get a refund on part of 20%. (Am assuming the 1099R will reflect the lump sum distribution, not a rollover.)
Question: How is the rollover reported on the personal tax return? Is there a line item for this? (I've never paid attention to this before.)
3. He can, still within 60 days of receiving check, roll over the 80%, therefore he will only be taxed on the 20%. However, when rolled over, is this considered after-tax money and does the accepting plan have to allow for this in plan provisions? Same question as #2, how to report on personal taxes?
I'd appreciate any help you can offer! Thanks!