US IRA Rollover From India: 60-Day Rule
Direct vs indirect IRA rollover, 10% withholding trap, 60-day deadline, and India tax on failed rollover.
The 60-second version
Indirect IRA rollover must redeposit within 60 days once per 12 months. From India I use direct trustee-to-trustee rollover to avoid withholding trap.
Indirect rollover from India is risky
If I take IRA distribution to my US bank and redeposit within 60 days, it is indirect rollover — 10% federal withholding applies and must be reclaimed.
Direct rollover: trustee sends funds to new IRA custodian — no taxable event, no India tax trigger.
Failed rollover = taxable distribution + possible 10% early withdrawal penalty if under 59½ — India taxes as ROR income with Form 67 FTC.
401(k): 401(k) guide.
Rollover types
| Type | Withholding | India tax |
|---|---|---|
| Direct trustee-to-trustee | None | None if no distribution |
| Indirect 60-day | 10% federal | Taxable if miss deadline |
| Roth conversion | Taxable event | India may tax conversion |
| RMD after 73 | Mandatory | Taxable India + US |
| Inherited IRA | Separate 10-year rule | Complex — get CPA |
Safe rollover from India
Choose direct
Request trustee-to-trustee transfer form.
Same custodian check
Fidelity → Fidelity simplest.
Avoid 60-day
Never take check to India address if avoidable.
Form 1099-R
Code G = direct rollover — verify.
India ITR
Only if taxable distribution occurred.
Rollover flow
IRA rollover kit
- 1099-R draft.
- Rollover confirmation.
- Custodian letter.
- Form 67 if taxable.
- Schedule FA IRA balance.
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Wire timing
60-day clock starts on distribution receipt — SWIFT delays eat the window.
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Rollover to India MF?
Not allowed — US IRA must stay US custodian.
Roth IRA rollover?
Same 60-day rules; conversion is taxable.
RNOR on IRA distribution?
US retirement may still be taxable in US; India RNOR may exempt foreign income.
State withholding?
Some states withhold — reclaim on US return.
Multiple IRAs?
Aggregate one indirect per 12 months — not per account.
FBAR on IRA?
IRA custodian account is FBAR-reportable.
Your tax year is already running.
RNOR status, exit timing, and DTAA benefits all depend on decisions you make before you land. Don't guess.