Sec. 438. Employer may rely on employee certifying that deemed hardship distribution conditions are met

393 words·~2 min read·/bill/119/hr/7314/ih/section-438

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

Section 401(k)(14) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph: In determining whether a distribution is upon the hardship of an employee, the administrator of the plan may rely on a certification by the employee that the distribution is on account of a financial need of a type that is deemed in regulations prescribed by the Secretary to be an immediate and heavy financial need and that such distribution is not in excess of the amount required to satisfy such financial need. . b ) plans Section 403(b)(7) of such Code is amended by adding at the end the following new subparagraph:

In determining whether a distribution is upon the financial hardship of an employee, the administrator of the plan may rely on a certification by the employee that the distribution is on account of a financial need of a type that is deemed in regulations prescribed by the Secretary to be an immediate and heavy financial need and that such distribution is not in excess of the amount required to satisfy such financial need. . Section 403(b)(11) of such Code is amended by adding at the end the following:

In determining whether a distribution is upon hardship of an employee, the administrator of the plan may rely on a certification by the employee that the distribution is on account of a financial need of a type that is deemed in regulations prescribed by the Secretary to be an immediate and heavy financial need and that such distribution is not in excess of the amount required to satisfy such financial need. . Section 457(d) of such Code is amended by adding at the end the following new paragraph:

In determining whether a distribution to a participant is made when the participant is faced with an unforeseeable emergency, the administrator of a plan maintained by an eligible employer described in subsection (e)(1)(A) may rely on a certification by the participant that the distribution is made when the participant is faced with unforeseeable emergency of a type that is described in regulations prescribed by the Secretary as an unforeseeable emergency and that the distribution is not in excess of the amount reasonably necessary to satisfy the emergency need. .

The amendments made by this section shall apply to plan years beginning after December 31, 2024.