How does the IRA 60-day rollover rule work?

The rule in one paragraph

Publication 590-A (2025) describes a rollover as a tax-free distribution to you of cash or other assets from one retirement plan that you contribute to another retirement plan within 60 days of receiving it. The contribution to the second plan is the rollover contribution. The clock starts on the day after you receive the distribution, and the day you receive it is not counted, which is why a June 30 distribution has its 60th day on August 29. This differs from a direct transfer, where the money moves between custodians and never reaches you; for that route see whether a trustee-to-trustee transfer is taxable.

The publication’s example

The publication’s example is a traditional IRA distribution received June 30, 2025, which the owner intends to roll over to a 403(b) plan. To postpone including it in income, the rollover must be completed by August 29, 2025, the 60th day. Enter June 30, 2025 in the calculator and it returns August 29, 2025. The section does not describe any extra time for weekends or holidays, so do not count on one; allow for custodian processing and mail time and finish well before day 60.

What happens if you miss it

In the absence of a waiver, amounts not rolled over within the 60-day period do not qualify for tax-free rollover treatment. You treat them as a taxable distribution from the IRA or employer plan, and they are taxable in the year distributed, even if the 60-day period runs into the next year. The publication’s example is a distribution in late December 2025 that is not rolled over in time and does not qualify for a waiver: it is taxable in 2025 even though the 60 days ended in 2026. You may also owe the 10% additional tax on early distributions if you are under 59½, described in Publication 590-B. A deposit made after the 60 days is generally a regular contribution, not a rollover, unless there is a waiver or extension, and may therefore run into the annual contribution limits.

Worked example of the cost

Say you are 45 and withdraw $20,000 from a traditional IRA with no basis on March 3, 2026, intending to move it. Day 60 is May 2, 2026. If you redeposit $20,000 by then, nothing is taxable. If you deposit only $15,000, the $5,000 you keep is taxable income, and because you are under 59½ it may carry a 10% additional tax of $500. If you miss the deadline altogether without a waiver, the full $20,000 is income and the additional tax could be $2,000. The 401(k) early withdrawal penalty calculator shows the same 10% math for plans. You can deposit only what you received; a rollover cannot exceed the amount distributed.

The frozen deposit extension

The publication provides one built-in extension. If any part of the amount distributed to you is a frozen deposit at any time during the 60-day period, the time it is frozen is not counted, and the 60-day period cannot end earlier than 10 days after the deposit is no longer frozen. A frozen deposit is one that cannot be withdrawn from a financial institution because the institution is bankrupt or insolvent, or because the state restricts withdrawals as institutions in the state are, or are about to be, insolvent.

Other timing rules worth knowing

A qualified plan loan offset gets longer: if the offset occurs because the plan terminates or you leave your job, you have until the due date, including extensions, for the return for the year of the offset. Required minimum distributions cannot be rolled over. And only one IRA-to-IRA rollover is allowed in any 1-year period, which is covered in the one-rollover-per-year page. If you have already missed the date, see whether the IRS can waive the 60-day deadline. Rollovers are reported on lines 4a and 4b of Form 1040, with the rollover box checked on line 4c.

Sources

• IRS Publication 590-A, Contributions to Individual Retirement Arrangements (IRAs) (2025): Rollovers; Time Limit for Making a Rollover Contribution; Rollovers completed after the 60-day period; Extension of rollover period. Read November 2, 2026.

Edition read: Publication 590-A (2025), for use in preparing 2025 returns, including its What’s New for 2026 note. Dollar limits and dates are for the year stated; check the current publication and form instructions for your tax year. This page summarizes the publication and does not replace it.