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How to roll a 403(b) into an IRA: checklist

403(b) to IRA rollover checklist: direct trustee-to-trustee steps, annuity surrender fees, withholding traps, and Roth vs traditional choices.

Reviewed September 2026.

A 403(b) (common for schools, hospitals, nonprofits) can often move to an IRA with the same core tax idea as a 401(k) rollover: prefer a direct trustee-to-trustee transfer so you never pocket the check. 401(k)-shaped twin: 401(k) to IRA rollover checklist. Job-change menu thinking: Roll over a 401(k) when you change jobs.

403(b) plans add a few frequent wrinkles: multiple vendors, annuity contracts with surrender charges, and employer/HR forms that take weeks. This checklist is educational, not a promise every contract is portable on your timeline.

Before you request the move

  1. Confirm the vested balance and whether any employer contributions still vest (Vesting concepts still apply when a match exists).
  2. Separate pre-tax 403(b) vs Roth 403(b) buckets. Pre-tax usually rolls to a traditional IRA; Roth 403(b) usually rolls to a Roth IRA. Converting pre-tax to Roth is a taxable Roth conversion, not a plain rollover.
  3. Ask whether the money sits in a mutual fund custodial account or an annuity. Annuities may charge a surrender fee if you leave early.
  4. Open the destination IRA first (Schwab, Fidelity, Vanguard, or similar) so you have an account number and “FBO [your name]” payee language.
  5. Check loans, hardships in progress, and whether you are still employed (some in-service rollover rules are stricter).

Direct vs indirect (same trap as 401(k))

PathWhat happensMain risk
Direct / trustee-to-trustee403(b) vendor sends assets to the IRA custodianLowest tax drama when coded as rollover
IndirectCheck payable to you; 60-day redeposit clockOften 20% federal withholding on eligible rollovers; you must replace withheld cash to roll 100%

Prefer direct. If a check arrives payable to you, call both custodians the same day and calendar the 60th day.

Worked example: $55,000 403(b), annuity surrender quote

Taylor leaves a hospital job with a $55,000 pre-tax 403(b) inside a TIAA-style annuity. The vendor quotes a $1,650 surrender charge (3%) if Taylor exits this year, falling to $0 in 14 months.

  1. Taylor opens a traditional IRA at Fidelity and requests direct rollover paperwork from the 403(b) vendor and HR.
  2. Taylor compares $1,650 fee now vs waiting 14 months for a free exit (and whether new-plan or IRA investment options justify waiting).
  3. Taylor rejects an indirect check payable to Taylor after learning about the 20% withholding trap.
  4. When the direct rollover posts, Taylor invests inside the IRA; that step is separate from the rollover tax coding. Pension lump sums use a related checklist: Roll a pension lump sum into an IRA.

Printable checklist

  1. List vendor name, contract type (annuity vs custodial), vested balance, Roth vs pre-tax split, and any loan.
  2. Get surrender-fee and distribution form timelines in writing.
  3. Open destination traditional and/or Roth IRA; save the account number.
  4. Request direct rollover to the new custodian (“FBO your name”).
  5. Track tracking numbers / wire confirms until the IRA shows the cash or in-kind shares.
  6. Keep Form 1099-R and IRA year-end statements for tax filing; confirm the distribution code looks like a rollover.
  7. If anything was converted to Roth on purpose, set aside tax cash and expect conversion income reporting.

Educational only. Not tax or investment advice. 403(b) contracts, surrender schedules, and IRS rollover rules are fact-specific; confirm with the plan vendor, IRS Publications 575/590-A, and a qualified professional.