New guidance refreshes your retirement rollover cheat sheet

Every tax season, someone walks into your office holding a check they were never supposed to cash. A retirement rollover gone sideways, a missed deadline or a client convinced they can move IRA funds around like chess pieces. Now the IRS has stepped in with new guidance, and it is worth understanding before your next client meeting turns into a cleanup job.

A fresh set of tools from the IRS

On Aug. 12, 2026, the IRS released Notice 2026-49 under §324 of the SECURE 2.0 Act. The notice provides optional sample forms and proposed procedures designed to make rollovers between retirement plans and between plans and IRAs less of a paperwork maze. Nothing here is mandatory. Administrators and trustees can use the sample forms and proposed procedures or continue using their own. The sample forms do not apply to IRA-to-IRA rollovers or transfers. Comments are due Oct. 23, 2026, so this is still a work in progress, not a finished rulebook.

For tax professionals, that matters. Optional guidance still shapes how administrators communicate with clients, and clients will bring you the paperwork wondering what changed.

The rules everyone should already know cold

Before anyone gets excited about new forms, remember the foundation has not moved. Under §402(c)(1), an eligible rollover distribution from a qualified plan stays out of gross income as long as it lands in another eligible retirement plan: a traditional IRA, a qualified trust, a §403(a) annuity, a governmental §457(b) plan or a §403(b) annuity. The clock still runs 60 days from the date the client receives the distribution.

Section 402(c)(3) allows the IRS to waive that deadline for equity or good conscience, such as cases involving casualty, disaster or something genuinely beyond the client's control. An automatic waiver, self-certification and private-letter-ruling paths may apply. Direct rollovers remain the smarter move. When the plan sends funds straight to the receiving IRA or plan, mandatory withholding generally does not apply. Hand a check to the participant instead, and the payer must withhold 20% of the taxable portion, leaving your client to cover that gap out of pocket if they want the full amount rolled over.

What still cannot be rolled over

Some distributions never qualify, no matter how badly a client wants them to.

• Required minimum distributions
• Hardship distributions
• Corrective distributions of excess contributions
• Certain substantially equal periodic payments
• Plan loans treated as deemed distributions
• ESOP dividends
• Cost of life insurance paid by the plan

A qualified plan loan offset gets special treatment when it stems from plan termination or separation from service; the deadline extends to the tax-return due date, including extensions.

The one-rollover rule still causes confusion

Section 408(d)(3)(B) limits clients to one IRA-to-IRA rollover in any 12-month period, and that limit aggregates across traditional, Roth, SEP and SIMPLE IRAs. Trustee-to-trustee transfers dodge the rule entirely, as do Roth conversions and rollovers between plans and IRAs. Non-spouse beneficiaries of an inherited IRA generally cannot roll funds at all, though a direct transfer to another inherited IRA may work.

And do not forget the §402(f) notice requirement. Administrators must deliver it 30 to 180 days before distribution, and Notice 2026-13 already updated the safe-harbor language for emergency personal expense distributions, domestic-abuse distributions, terminal-illness distributions and the higher $7,000 involuntary-cashout threshold. Skip the notice, and the penalty runs $100 per failure, capped at $50,000 a year.

Why this is the moment to get sharper

Rollover rules rarely make headlines, right up until a client's retirement savings land in the wrong bucket and the phone rings. Staying current on notices like this one is exactly the kind of expertise that separates a preparer clients trust from one they merely tolerate.

That is the work NATP was built for: practical education, timely updates and a community of tax professionals who read the fine print so you do not have to read it alone. Whether guidance like Notice 2026-49 is already familiar to you or something you are still working to master, it is time to see what NATP membership can add to your practice.