I have two IRA accounts at a bank. If I transfer some funds from one of those IRA account directly to the other IRA account (at the same bank), does the transfer constitute a taxable distribution/withdrawal? Will this transaction result in any reporting to the IRS?
Assuming both accounts are a traditional IRA, if you do a trustee-to-trustee transfer then no 1099-R will be issued. So even though it's at the same bank, make sure it's a trustee-to-trustee transfer, even though the trustee on the accounts may be the same.
Otherwise, if you don't do that then a 1099-R will be issued for the account you withdraw from. You simply indicate on your tax return that it was a rollover and the amount won't be taxed.
No it is NOT a distribution ... it is a trustee to trustee rollover and if both trustees are the same then a 1099-R is usually NOT issued. Sounds like you are consolidating 2 "CD IRAs" as the banks call them. Banks have the annoying habit of opening a new IRA account for each CD you invest in instead of adding a new contribution to the IRA you already have established. Personally I think the bank managers get a bonus based on "new accounts/IRAs" they "open" so they don't just let you add to the exhisting IRA account ... I have seen some of my clients with multiple IRA accounts all at the same bank each with their own CD in them which is a bunch of BS ... one IRA account can house mulitple CDs they do not need there own separate account. This would be like buying a new house for every piece of furniture you buy which is equally absurd. All you need is one IRA (house) to "house" all of your investments (furniture).
What you describe is a direct rollover. There are no tax consequences, and there may not even be a 1099-R issued. Even if a 1099 is issued, the transaction is not taxable. You can do as many direct rollovers as you like.
If you requested funds to be withdrawn from an IRA, either electronically or by check, which you then forward to a separate IRA, that is an indirect rollover. You can only do one indirect rollover per year, and you must complete the rollover within 60 days, or else the distribution will be taxable.
What is described is a trustee-to-trustee transfer, not a direct rollover. The term "direct rollover" only applies to movement of funds to or from a qualified retirement plan like a 401(k) and no such plan is involved here.
As Carl said, make sure that the bank classifies the movement of the funds from the first IRA as a transfer and classifies the receipt of the funds by the second IRA as a transfer. Do not permit the bank to classify the movement of the funds out of the first IRA as a distribution or the deposit of the funds into the second IRA as a rollover; it is neither. Bank front-office representatives are notorious for making this mistake, so check any paperwork carefully before signing.