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Others have already discussed the 60-day rollover limit, but you probably should refer to IRS Pub 575 for more information (you can download it at www.irs.gov).

I never got around to filling out the paperwork for a direct rollover to the new company's 401K or an IRA, and so a check was cut, with an amount for taxes taken out (and an amount for early withdrawl penalty?)

Your old employer probably withheld 20% of the balance and forwarded it to the IRS. When you fill out your tax return for the year, the total withdrawal from the 401k added to your taxable income and the 20% they withheld would be added to your "taxes already paid" line on Form 1040; depending on your tax bracket, you might still owe more taxes from the 401k disbursement than what you have already paid. There is also the 10% penalty tax which would also need to be paid.

If you somehow manage to get it straightened out, the amount withheld would become a tax refund (or defray other taxes owed on form 1040).

Good luck,
JDOyster
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