Retirement plan administrators routinely receive requests from employees to accept rollover contributions of amounts held in a prior employer’s qualified plan or, in some cases, an individual retirement account. When processing these requests, plan administrators must be mindful of Internal Revenue Service guidelines that require them to be reasonably certain that the distribution is being made from another qualified plan or plan permitted to make a rollover distribution before accepting the rollover and contributing it to the plan’s trust.

Failure to follow IRS guidelines in accepting rollover contributions could compromise the tax qualified status of the plan and trust, so the plan should have and follow written procedures when processing rollover requests. Recent IRS guidance provides a good refresher on the guidelines that retirement plan administrators should follow when a request is received to roll money into the plan and also provides some updates to current guidance on accepting rollover contributions should make it easier for plan administrators to process rollover funds received.

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