Hardship Withdrawals

[Nassau]

I am elevating a new 401(k) that’s offering hardship withdrawals. The prior recordkeeper never maintained a hardship bucket on their system because the plan was previously a 401(a) that did not permit hardship withdrawals

Questions: Now that I am elevating hardship withdrawals for the new 401(k) plan do I need to ask the prior recordkeeper for inception year to date contribution amounts so that I can load to the hardship bucket. Or does the hardship bucket starts from now, since I am adding hardship withdrawals to the plan effective 01/01/2015?

[ETA Consulting LLC]

You would want to get historical deferrals to load to the system. You "may" obtain this from historical W-2 information from the client going back to the year they first allowed deferrals to the plan. It may also help if you only obtain this information from those who are less than 59 1/2.

But, the hardship would not reference the period of time you took over. Instead, it will reference all deferrals since the time the plan first allowed them.

Good Luck!

[BG5150]

It may also help if you only obtain this information from those who are less than 59 1/2.

I think this would only be relevant if the plan otherwise allows in-service withdrawals at age 59 1/2.

[BG5150]

Could you have the amendment say that hardships from deferrals are only allowed on deposits after the amendment date? (You'd probably have to keep track of them separately, before and after).

[BG5150]

Elevating? I learned a new pension word.