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Washington, DC - Today the U.S. Department
of Labor’s Employee Benefits Security Administration (EBSA), along with
the Internal Revenue Service (IRS), announced guidance for employers and plan
officials to help victims of Hurricane Katrina obtain distributions and loans
through 401(k) and similar employer-sponsored plans.
“Helping Hurricane Katrina’s survivors
get back on their feet is our highest priority,” said Secretary of Labor
Elaine L. Chao. “These actions will make it easier for those in need to
get hardship withdrawals and loans from their 401(k)s and similar plans so they
can begin rebuilding their lives.”
The Department of Labor will not treat any person
as having violated the provisions of title I of the Employee Retirement Income
Security Act solely because they complied with the provisions of IRS
Announcement 2005-70. The IRS announcement, in conjunction with the DOL
statement, expands the circumstances under which hardship and loan
distributions can be made from a plan to participants and beneficiaries
affected by the hurricane. The announcement also eliminates the need for
obtaining otherwise required documentation in advance of a hardship or
participant loan distribution.
The Labor Department and IRS will continue to
monitor the situation to address those issues that are most important in
helping individuals, employers, and plan sponsors recover from this tragedy.
Further guidance will be
forthcoming. For more information on Hurricane Katrina relief, contact the
department at 1.866.4USA.DOL or EBSA at 1.866.444.EBSA (3272). Questions about
the IRS announcement should be directed to the IRS at 1.877.829.5900. |
