Barnard & Associates https://www.401kpensacola.com Retirement Plan Specialists, LLC Tue, 26 Feb 2019 16:40:54 +0000 en hourly 1 https://wordpress.org/?v=5.7.1 https://www.401kpensacola.com/wp-content/uploads/2018/07/401Kpensacola-150x150.png Barnard & Associates https://www.401kpensacola.com 32 32 Changes to 401k Plan Hardship Distributions https://www.401kpensacola.com/changes-to-401k-plan-hardship-distributions/?utm_source=rss&utm_medium=rss&utm_campaign=changes-to-401k-plan-hardship-distributions Fri, 04 Jan 2019 23:39:42 +0000 https://www.401kpensacola.com/?p=2440 On 11/9/2018 the IRS released proposed amendments to the 401(K) Plan Hardship Distributions regulations.  These amendments result from the Tax Cuts & Jobs Act of 2017 (Tax Act) and the Bipartisan Budget Act of 2018 (Budget Act).

The proposed regulations include revisions to the rules for determining if the distribution is necessary to satisfy an immediate and heavy financial burden by eliminating:

  1. The requirement that employees be suspended for 6 months from making salary deferral contributions; and
  2. The requirement that employees take plan loans prior to obtaining a hardship distribution.

The facts and circumstances determination of financial need has been eliminated.  There is now one general standard provided under which the hardship distribution may not exceed the amount needed to satisfy the financial burden, including amounts needed to pay any income taxes or penalties.  Employees must take any other available distributions before taking a hardship distribution.

The proposed regulations also expand the money sources available for hardship distributions.  Hardship distributions may be taken from Salary Deferral, QNEC, QMAC and Safe Harbor Matching, as well as earnings on these amounts.

For more information, go to https://www.federalregister.gov/documents/2018/11/14/2018-24812/hardship-distributions-of-elective-contributions-qualified-matching-contributions-qualified

]]> New Fiduciary Rule Effectively “Killed” https://www.401kpensacola.com/dol-extends-compliance-start-date-for-new-fiduciary-rule/?utm_source=rss&utm_medium=rss&utm_campaign=dol-extends-compliance-start-date-for-new-fiduciary-rule Thu, 03 May 2018 22:29:47 +0000 http://www.401kpensacola.com/?p=1779 We previously reported that due to a Presidential Memorandum issued on 2/3/17, the Dept. of Labor has granted a 60 day extension to the application of the fiduciary rule and exemptions known as BICE (Best Interest Contract Exemption).  The Fiduciary Rule was to go into effect 4/10/2017 but will now go into effect on 6/9/17.

As of June 21, 2018, the U.S. 5th Circuit Court of Appeals officially vacated the rule. Financial advisors and investment firms have, however, made changes to comply with the Fiduciary Rule.  Many of those changes will remain in place.

Under the Fiduciary Rule, financial advisors to retirement plan participants would have become fiduciaries.  Fiduciaries must act solely for the benefit of plan participants and their beneficiaries.  Fiduciaries must act with the care, prudence and diligence of a prudent person.  For more information about fiduciary responsibilities, visit https://www.irs.gov/Retirement-Plans/Retirement-Plan-Fiduciary-Responsibilities

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