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Ralph asks:

My question now is, can I send the payments directly within 60 days to an established Vanguard traditional IRA myself or do I have to establish a plan with the payer to send the money to Vanguard? Can I mix the methods?

Yes, you could send those payments to your IRA within 60 days of receipt yourself should you so desire. Just remember that 20% was withheld for potential income taxes by the plan, and that 20% must be claimed as income by you at tax time. If you wish to avoid that, then you must take funds from other resources and add the missing 20% to the rollover. The withholdings would be refunded to you at tax time depending on your overall income tax situation at that time. I mention that only because it's easy to forget what happens when you receive direct payments yourself.

IMHO a simpler approach may be to arrange for a direct transfer of the plan money to an IRA or IRAs of your choice. That way nothing gets withheld and you will not have to declare any part of the distribution as income for the year.

And yes, you can mix the two procedures (direct transfer and rollover) if the plan allows you to do so. That's up to the plan.

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