@rachellee I just did the same thing. I had a Merrill rep on the line, requesting a Direct rollover from a former Employee's 401k at Empower into my existing Merrill Edge Trad. IRA (which is from another rollover a while back). All funds are pre-tax.
The Merrill rep said that Empower doesn't do Direct rollovers, as he just had a similar experience with another customer recently. We got on a 3 way call, Merrill, me, and Empower, and I requested a Direct Rollover from my 401k at Empower to my Merrill Edge TIRA. Empower said they could not send the check directly to Merrill, and it HAD to be sent to me.
I was a bit confused because after being laid off from my ex-employer, they emailed me about what I would like to do with my 401k, and a Direct Rollover to IRA was one of the options. I tried to tell them to send the check directly to Merrill, but the Empower rep refused saying it had to be mailed to me. When asked, who should the check be out to, the Merrill rep jumped in and said make the check out to "Merrill", and For the Benefit of: Me (my name) and provided my plan number. Empower rep confirmed the total amount minus admin fees ($75), which was correct, will be mailed to my address.
Afterwards, the Merrill rep said deposit the check by taking a picture of it with the Merrill App.
I am just worried because I read that having a check sent to me could be penalized and taxed. I asked Empower rep if I have to deposit the check before 60 days, and she said no and they would send a 1099-R for my taxes even though the funds are pretax.
Both employer and employee contributions and earnings in my Empower 401k are 100% vested and the funds are >$7000. I decided to rollover to my TIRA because I already did one from a while back, so a backdoor in the future is not possible anyways. I've never made an after-tax contribution to any IRA.
I see from some replies here that if the check is made out to my new custodian, it is still a direct rollover and I should be good.
Would this apply to my case as well? I hope everything goes ok and I don't get penalized with taxes.