What Happens to Your 401(k) When You Change Travel Agencies?
What you put in yourself always goes with you, while the agency’s match goes with you only as far as it has vested, and the rest can be forfeited when you leave. What you then do with the balance, whether you leave it, move it to the next agency’s plan or roll it to an IRA, decides whether it stays tax-deferred or loses part of itself to withholding and penalties.
Which part of your 401(k) is yours when you leave an agency?
The IRS is plain about your own money: “An employee's own contributions to the plan (for example, employee elective deferrals deducted from salary) are always 100% vested, or owned, by the employee.” The match is different. A 401(k) can use “a variety of different vesting schedules that are determined by the plan document,” from “immediate vesting, to 100% vesting after 3 years of service,” and “Amounts that are not vested may be forfeited by employees when they are paid their account balance (for example, when the employee terminates employment).”
The Department of Labor names the risk: “Changing jobs often puts you at risk of not vesting in your current job’s retirement plan, or a new job may not offer a retirement plan.” That is why the benefits issue treats a long cliff schedule as no match at all. Ask how the plan counts a year of service, too. The IRS says plans commonly define it as “1,000 hours worked over 12 months,” and “Employers can choose to use different methods of counting service,” so weeks between contracts can matter.
What can you do with the old balance?
When you leave a job with a 401(k), the IRS says “you generally have four options for your account balance”:
- Leave it in the old plan. Reasonable if you like its investment choices and fees. For a small balance, though, the IRS notes that “your employer may require you to move it.”
- Roll it into the next agency’s plan. Only if that plan takes it: “Your retirement plan is not required to accept rollover contributions.”
- Roll it into an IRA, traditional or Roth. Moving untaxed money into a Roth IRA means “you must include the untaxed amount in your gross income for the year in which you do the rollover.”
- Cash it out. You “will likely have to pay income tax on any previously untaxed amount that you receive,” and “may have to pay an additional 10% early distribution tax if you aren’t at least age 55.”
The Labor Department points the same way: “Consider keeping your money in your former employer's retirement plan or rolling it into a new company plan or an individual retirement account (IRA).” For a traveler with a plan at each of several agencies, consolidating also means fewer accounts to track.
How do you move it without losing money to withholding?
Ask for a direct rollover. In the IRS’s words, you “can ask your plan administrator to make the payment directly to another retirement plan or to an IRA,” and “No taxes will be withheld from your transfer amount.”
The trap is taking the check yourself. “A retirement plan distribution paid to you is subject to mandatory withholding of 20%, even if you intend to roll it over later.” You then have 60 days to deposit it, and “If you later roll the distribution over within 60 days, you must use other funds to make up for the amount withheld.” Whatever you cannot make up counts as income for that year and can draw the early distribution tax as well. Between contracts, when cash is already tight, that is an easy way to lose part of an account you meant to keep.
If you're weighing what a new agency's retirement plan is worth, ask a ProTherapy recruiter for its terms in writing: Find my next contract.
What should you ask before you join or leave an agency?
Put these to the recruiter, and get the answers from the plan documents rather than from memory:
- Is there a match, and on what vesting schedule? The IRS points you to “the Summary Plan Description” or your “annual benefits statement” for the answer.
- How does the plan count a year of service if you take weeks off between contracts?
- Does the plan accept rollovers from an earlier employer’s plan or an IRA?
- Is there a Roth 401(k) option?
- When you leave, how do you request a direct rollover? The IRS says the plan administrator “must give you a written explanation of your rollover options.”
One rule follows you across agencies: the deferral limit applies to you, not to each plan, which matters if two agencies pay you in the same year. The travel PT benefits guide quotes the IRS limit and the vesting rules in full.
Frequently asked questions
Do I lose my 401(k) if I leave a travel agency?
No. The IRS says your own contributions are always 100% vested. Only employer contributions that have not yet vested under the plan's schedule can be forfeited when you leave.
Should I cash out an old agency 401(k) between contracts?
The IRS says a lump-sum withdrawal will likely be taxed as income on any previously untaxed amount, and may carry an additional 10% early distribution tax if you aren't at least age 55. Rolling the balance into another plan or an IRA keeps it tax-deferred.
How do I avoid the 20% withholding on a 401(k) rollover?
Ask the old plan for a direct rollover to the new plan or an IRA. The IRS says no taxes are withheld from a direct transfer, while a distribution paid to you has 20% withheld even if you intend to roll it over.
Sources
- IRS: Retirement topics, Vesting, read October 22, 2026
- IRS: Retirement topics, Termination of employment, read October 22, 2026
- IRS: Rollovers of retirement plan and IRA distributions, read October 22, 2026
- U.S. Department of Labor, EBSA: Changing jobs and job loss, read October 22, 2026