Description
Explore hardship distribution rules, tax consequences, safe harbor guidelines, and strategies to avoid penalties.
Navigating the complex regulations surrounding hardship distributions from retirement plans can lead to potential tax penalties and increased regulatory scrutiny. This webinar will provide essential insights into managing hardship distributions effectively. Participants will learn to identify situations and plans for which hardship or similar distributions may be made. They will also understand the tax consequences and strategies to avoid penalty taxes in specific situations.
Date: 2025-02-05 Start Time: 1:00 PM ET End Time: 2:40 PM ET
Learning Objectives
* You will be able to define hardship distributions.
* You will be able to describe circumstances in which hardship distributions may be made.
* You will be able to discuss tax consequences in hardship distributions.
* You will be able to strategies to avoid penalty taxes.
Background
• Plans Covered
• Definition of Hardship
• Historical Limits on Hardship Distributions
• Changes Made by Balanced Budget Act of 2018 (BBA)
Availability of Financial Hardship
• Financial Hardship of a Participant
• Distribution on Account of Financial Hardship
• Other Distributions Are Available
Tax Consequences of Hardship Distribution
• Distribution on Account of Hardship Cannot Be Rolled Over
• Distribution Is Taxable in Year Distributed
• Distribution Is Subject to 10% Penalty Tax
• Reporting of Distributions
Safe Harbor Hardship Distributions
• Expenses for Medical Care
• Purchase of a Principal Residence
• Payment of Tuition, Education Expenses, Room and Board for Post-Secondary Education of Employee, Spouse or Dependent
• Payments to Prevent the Eviction of the Employee From Principal Residence
• Burial or Funeral Expenses of Certain Family Members or Primary Beneficiary Under the Plan
• Repair of Damage to Employees Principal Residence
• Losses Incurred as a Result of a Disaster Declared by FEMA
Requirements for Substantiating Hardship Distributions
Correcting Errors
CLE (Please check the Detailed Credit Information page for states that have already been approved) ,Enrolled Agents ,CPE ,Additional credit may be available upon request. Contact Lorman at 866-352-9540 for further information.
Robert C. Schmidt-Kean Miller LLP
