Rollovers can occur directly or indirectly. With a direct rollover, your previous custodian makes the rollover check payable to your new custodian and sends it either to you or to your custodian for deposit into your new account. With a direct rollover, you can avoid the 20% federal withholding requirement for taxes.
An indirect rollover is when the previous custodian makes the rollover check payable to you for deposit into your personal account. You must then re-deposit the funds into your new account within 60 days. An indirect rollover requires that your previous custodian withhold 20% in federal taxes. Accordingly, when re-depositing the rolled funds into your new account, you will have to make up the 20% difference out of pocket. If you do not re-deposit the full rollover amount within 60 days, the IRS will consider it a distribution and tax it as income (plus a potential premature penalty tax if you are under the age of 59 ½).