EMPLOYEE BENEFITS LEGAL UPDATE: RELIEF FOR VICTIMS OF HURRICANE HARVEY
August 30, 2017
The Internal Revenue Service just released Announcement 2017-11, which provides certain relief for victims of Hurricane Harvey. In particular, the announcement permits certain types of plans, including a 401(k) plan, regardless of whether the plan has provisions permitting the plan to do so, to make hardship distributions and plan loans available to an employee or former employee whose principle residence on August 23, 2017, was located in one of the Texas counties identified for federal assistance by FEMA, or whose place of employment was located in one of these counties on that applicable date, or whose lineal ascendant or descendent, dependent, or spouse had a principle residence or place of employment in one of these counties on that date.
The counties identified for individual assistance by FEMA can be found on FEMA’s website at https://www.fema.gov/disasters. To the extent that additional counties are added to the FEMA list, the relief provided in the Notice will also apply. In the case of a hardship distribution, the distribution must be made on or after August 23, 2017, and no later than January 31, 2018. In addition, certain procedural requirements for plan loans or hardship distributions are waived. If the plan does not currently permit plan loans or hardship distributions, the plan must be amended no later than the end of the first plan year beginning after December 31, 2017.
The Employee Benefits Alert is intended to keep readers current on matters affecting employee benefits and is not intended to be legal advice. If you have any questions about this alert or any other issues relating to employee benefits, please contact William Carter at 412.566.6016, Kathryn English at 412.566.1226, Heather Stone Fletcher at 412.566.6112, Michael Herzog at 412.566.6130, Sandra Mihok at 412.566.1903, or Paul Yenerall at 412.566.1944.
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