Leaderboard

the original safe harbor notice (98-52 IV.H) had the following language, nothing has changed since then (e.g. just because QACAs didn't exist at the time the original notice was issued, there is no "we make an exception to the hardship rule in regards to QACAs" For purposes of this notice, safe harbor matching contributions and safe harbor nonelective contributions are matching and nonelective contributions, respectively, that (1) are nonforfeitable within the meaning of § 1.401(k)-1( c), 2) are subject to the withdrawal restrictions of § 401(k)(2)(B) and § 1.401(k)-1(d), and (3) are used to satisfy the safe harbor contribution requirement of section V.B. Accordingly, pursuant to § 401(k)(2)(B) and § 1.401(k)-1(d), such contributions (and earnings thereon) must not be distributable earlier than separation from service, death, disability, an event described in § 401(k)(10), or, in the case of a profit-sharing or stock bonus plan, the attainment of age 59 ½. Pursuant to § 401(k)(2)(B) and § 1.401(k)-1(d)(2)(ii), hardship is not a distributable event for contributions other than elective contributions.

Sure. Likely, related to some (very) bad asset experience. For example, - A large portion of the assets took a sudden (unanticipated) nose-dive. - The liquid assets went down but the illiquid assets could not be converted to cash easily enough (or soon enough) to meet the payment date.