CARES Act Summary for Retirement Plan Sponsors

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04/09/20

The COVID-19 pandemic has made its impact throughout the United States.  Not only has it had a significant effect to the economy, it has changed nearly every Americans’ way of life.  It has most definitely made its mark on your company, which may present serious financial difficulties for your employees.

On March 27, 2020, the Coronavirus, Aid, Relief and Economic Security (CARES) Act was signed into law.  In addition to the stimulus aid for businesses and families, the Care Act provides provisions for plan sponsors to assist participants dealing with the financial impact of the COVID-19 pandemic.  The provisions are immediately available in the form of expanded plan distributions and loan options.  Plans, not currently allowing in-service withdrawals or participant loans, may implement the provisions and adopt plan amendments retroactively.

Participants taking advantage of the coronavirus relief provisions, whether a distribution and/or a loan, must be a Qualified Individual.

A Qualified Individual is:

The plan sponsor may rely upon the participant’s certification he/she meets the criteria to be considered a Qualified Individual.

RELIEF PROVISIONS INCLUDE

 Coronavirus – Related Distribution

Coronavirus – Related Loan Relief

Waiver of Required Minimum Distributions (RMDs)

Under current law, individuals at age 72 must take an RMD from their DC plans and IRAs.  The CARE Act provides relief from the required minimum distribution rules.

Defined Benefit Plan Relief

Plan Amendments

Acumen Wealth Advisors remains a resource for you and your employees.  We are here to help in this time of uncertainty.  We encourage you to contact us with any questions you may have.

 

 

 

 

 

This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting, or tax advice.  Do not act or rely upon the information and advice given in this publication without seeking the services of competent and professional legal, tax, or accounting counsel.  Publication and distribution of this article is not intended to create, and the information contained herein does not constitute, an attorney-client relationship.  All information is current as of the date of herein and is subject to change without notice.  The information has been obtained from sources we believe to be reliable; however, no guarantee is made or implied with respect to its accuracy, timeliness, or completeness. 

Acumen Wealth Advisors, LLC® is a Registered Investment Adviser.  Advisory services are only offered to clients or prospective clients where Acumen Wealth Advisors, LLC® and its representatives are properly licensed or exempt from licensure.  Past performance is no guarantee of future returns.  Investing involves risk and possible loss of principal capital.  No advice may be rendered by Acumen Wealth Advisors, LLC® unless a client service agreement is in place.

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