What it is
A direct rollover moves a distribution from one qualified plan to another, or to an IRA, without you taking possession. No withholding, no 1099-R cash line, no 60-day clock. Check the form codes: a direct rollover reports as a non-taxable transfer.
What to do about it: Forced cash-outs below the plan threshold are reported on a 1099-R with 20% withholding if not rolled. Ask for the payout method in writing before your last day.
Plain-language description of US practice, not legal, tax, or financial advice. The paired guide carries the citations, dates, and thresholds; the state pages carry the local windows.