One-Rollover-Per-Year Rule

The one-rollover-per-year rule limits you to a single indirect (60-day) IRA-to-IRA rollover in any 12-month period — counted across every IRA you own, Traditional and Roth combined. The 12 months run from the date you received the first distribution, not from January 1.

The rule got teeth in 2015. Before then, the IRS applied it separately to each IRA. In Bobrow v. Commissioner (2014), the Tax Court held the limit applies in aggregate across all of a taxpayer's IRAs, and the IRS adopted that reading for distributions beginning January 1, 2015. One 60-day rollover from any IRA now locks the rule for all of them.

What the rule does NOT cover matters more than what it does. It does not apply to trustee-to-trustee transfers between IRAs, direct rollovers, rollovers between a 401(k) and an IRA in either direction, or Roth conversions. All of those are unlimited. The rule bites only when you take physical possession of IRA money and redeposit it within 60 days — twice within 12 months.

The consequences of a violation are severe. The second distribution cannot be rolled over at all: it becomes taxable income, plus the 10% early-withdrawal penalty if you are under 59½. And if you deposited it into an IRA anyway, that deposit is treated as a regular contribution — usually an excess contribution, hit with a 6% excise tax for every year it stays in the account.

There is no fix. Unlike a missed 60-day deadline — where IRS self-certification under Rev. Proc. 2016-47 can rescue a qualifying case — the one-per-year rule has no hardship exception, no self-certification, and no IRS waiver authority. Once the second rollover happens, the tax outcome is locked. The only mitigation is withdrawing the excess contribution promptly to stop the 6% excise from repeating.

The avoidance strategy is the same as always: move IRA money by trustee-to-trustee transfer, never by check made out to you. Transfers are unlimited, unreported, and the rule never triggers.