tymesup Posted June 8, 2009 Posted June 8, 2009 Can new loans be eliminated from a plan, prospectively? If so, is a 204(h) Notice required ahead of time? What would you do about existing loans? Thanks in advance for any help.
J Simmons Posted June 8, 2009 Posted June 8, 2009 Yes, loans are not a benefit protected from cutback. 204h notice? No. Those with existing loans would yet payoff as scheduled under the specific loan documents. John Simmons johnsimmonslaw@gmail.com Note to Readers: For you, I'm a stranger posting on a bulletin board. Posts here should not be given the same weight as personalized advice from a professional who knows or can learn all the facts of your situation.
Guest Sieve Posted June 9, 2009 Posted June 9, 2009 Since loans are not a protected benefit (Treas. Reg. Section 1.411(d)-4, Q&A-1(d)(4)), even the right to a new loan from "old" money can be eliminated entirely on a prospective basis. 204(h) Notice only applies to DB plans and to DC plans subject to IRC Section 412 (i.e., MPPP). It does not (yet) even apply to matching contributions (although prospective elimination/reduction of SH contributions is subject to its own advance Notice requirements).
Recommended Posts
Create an account or sign in to comment
You need to be a member in order to leave a comment
Create an account
Sign up for a new account in our community. It's easy!
Register a new accountSign in
Already have an account? Sign in here.
Sign In Now