Legal Time Frame to Transfer 401K funds to personal IRA

[orch1ds]

California

Hello,

I have recently changed jobs and is now wanting to transfer my 401k funds to my private IRA with a different brokerage firm. However, I'm having a very difficult time getting my former employer's HR to send me the necessary distribution forms. I tried contacting the brokerage company directly and they said that I must request it from my former employer.

Is there a legal timeframe in which my former employer is required to carry out my requests to transfer my 401K funds?

I may need a lawyer if it comes to that.

Thanks!

OrchidWhat is the name of your state?

 

[efflandt]

There is no time limit how quickly 401(k) funds need to be moved if still in the old 401(k), since many plans allow you to leave it there if you want to. But if or when they issue a check to you, it would have to be rolled over to an IRA [or other 401(k) within 60 days, including making up any tax withheld from the distribution to avoid penalty. To avoid tax withholding, it is best to do the direct trustee-to-trustee transfer that you appear to be attempting.

I don't know if it is a general rule, but our plan sends a check if it is less than $5000. If it is more than that, they may need time to liquidate cash from investments. When our company moved our 401(k) plan to a new trustee, the funds from the old trustee had to remain at fixed interest for a year before we could self invest it (maybe to make sure everything was accounted correctly).

I was able to initiate Regular IRA to IRA transfers directly from the destination trustee. But in one case (from insurance company) it took a couple of months (expiring IRA CD from a bank was much quicker).

If you have, or can get, your 401(k) plan documents, they should spell out what happens or to do upon retirement or termination. But even though there is no IRS deadline for moving it from the old account, I would certainly try to find out the transfer procedure, so they do not end up sending you a check, minus required 20% tax withholding.