Of note, any initial rollover amount won't be matched by your employer. They may offer a contribution match up to a set percentage of your new salary, but that would only apply to future contributions from your regular paychecks, not any amounts you roll into their plan from prior investments.
4. Executing a trustee-to-trustee transfer, commonly known as a rollover, into an IRA. A rollover IRA allows you to transfer your retirement funds from one or more prior 401(k)s into an investment plan with potential strategic advantages. You can open an IRA for the purposes of a rollover if you don't already have one established, or you can also roll over your old 401(k) funds into an existing IRA.
You cannot combine traditional IRA and 401(k) funds with Roth IRA and Roth 401(k) funds, however, so make sure you know the specifics of each of your investment plans before considering a move.
Also, you may only execute one rollover per 12-month period between multiple IRAs that you own; however, this rule does not apply to a significant number of circumstances, such as rolling 401(k) plans into IRAs or executing trustee-to-trustee rollovers in which you do not personally take distribution of any funds. This means that you are able to roll multiple 401(k) plans into a single IRA within the same 12-month period, enabling you to compress the timeline of this process significantly if you elect to make this decision.
Rollover IRAs can offer several potential benefits, some not available through 401(k) plans. First, a rollover from one or more 401(k) plans into an IRA continues the deferral of taxation of your retirement contributions enjoyed when they came from your salaries at prior employers. Although you are obligated to report rollovers of this nature to the IRS, a properly executed rollover does not carry tax consequences on its own, as the funds are transferred between retirement plan custodians rather than being distributed, even if only temporarily, directly to you.