Transfer vs. rollover: What is the difference?

A rollover differs from an IRA transfer in that a transfer happens between retirement accounts of the same type, whereas a rollover occurs between two different types of retirement plans.

A transaction is a transfer if you move assets from one IRA to another, for example. A rollover is a change in an employer-sponsored retirement plan into an individual retirement account (IRA).

When you convert a traditional IRA to a Roth IRA, it's known as a Roth conversion. The distinction is significant since the IRS classifies these procedures differently for tax purposes.