Tax-free rollovers from a qualified retirement plan to a traditional IRA can be accomplished two ways. The best way is to arrange for a trustee-to-trustee transfer. In this manner, no amount will be withheld for income taxes and there is no tax liability. The next method is for you to receive a check for the amount to be rolled over and for you to deposit the gross amount of the distribution (the amount before tax withholding) into a traditional IRA. If you roll over only the net amount of the check after withheld taxes, then you will have taxable income for the amount withheld for taxes. Also, you must complete the rollover within 60 days or the total distribution may be taxable.
If the retiree is past age 70½ and must take a minimum required distribution from the plan, the minimum distribution cannot be rolled over. You must first have the retirement plan issue the distribution and then have the plan administrator transfer the balance to your IRA account.