I have multiple plans across different states due to sign up bonuses and I think I messed up by violating the ONE rollover every 12month rule.
Let's say I'm the Husband, my name is Jon
I have a Wife Mary
A child Kim
Jon has an account w MI, MN, NY, CA, and beneficiary assigned as Mary, Jon, Kim for each state
Mary has the same setup at MI NM NY CA beneficiary assigned as Mary, Jon, Kim for each state
Jon and Mary are trying to consolidate funds from the different states. For each state they transfer funds so that Each state now only has funds with Kim as the Beneficiary.
Part 1.
We initiate ACH withdrawal request for an indirect rollover from MI for $1000. NY for $500.
Jon makes $1000 NY deposit into CA's Kim account (indirect). Because Jon's CA Kim acct already has ONE roll over
1. Can Jon deposit the $500 (from NY) into his own CA account with himself as the beneficiary?
2. or Should Jon just make a deposit of $1500 (from NY and MI) into Jon's Kim account from the get go?
When I played w Turbotax, it didn't even ask who the money went to, it's either "original beneficiary, family member of original beneficiary or someone else."
My understanding is (please correct me if I am wrong) I can rollover the funds to a different beneficiary as long as it meets the "Family" definition.
Part 2.
Forget the scenario from above, let's say Jon did a DIRECT rollover in which NY and MI directly rolled the funds to Jon's CA acct (Kim beneficiary)
Now one of the roll over will be classified as non qualifying rollover and hit w 10% penalty.
Is there anyway to transfer the funds to Jon's acct w himself as the beneficiary (afterwards) despite the rollover from Ny/MI. Any chance I can get say CA to reclassify the 2nd direct rollover as a non eligible rollover, use the full $1000 as the principal, no earnings. I don;t mind making a new contribution if I can avoid the penalty from the 2nd rollover.
Lastly, all these transfer of funds will take place within the 60 day time frame.
