"The long and short of this is that you are in fact doing nothing more with the money than transferring it from one custodian to another custodian. That's why it is not considered to be a taxable event."

The first custodian is going to send me a 1099-R, no? So the IRS will expect me to explain what I did with the funds. My question is will this explanation take place over two tax returns, or just the one for 2001? When I mentioned tax liability, I was thinking that if it was spread over two returns then perhaps I might need to pay the tax this year, and then be refunded next year. This assuming that there was any tax due, as would be if I made a withdrawl from a regular IRA or one that exceeded my contributions to a Roth.