Safe Harbor as source for Insurance Premium?

[Kac1214]

Is it permissible to use Safe Harbor money as a source for paying insurance premiums? Participant is under 59 1/2. If so, what are limitations?  Thanks for any input or cites. 

[Tom Poje]

without researching further to see if anything has been indicated one way or another,

401(k)(12)(E) only says distributions and withdrawal requires are the same as 401(k)(2) which refers to deferrals. since you could pay for insurance via deferrals I would assume the same rules would apply to safe harbor, in other words it is not considered a 'distribution' in that sense of the word..

but then, since insurance in a DC plan is such a unique animal I could be wrong, not having dealt with it.

[Bird]

No problem.  Insurance is in essence a self-directed account and unless there were weird restrictions put in place you could use any source.

[Kac1214]

Thank you both for your responses. I couldn't find anything that clearly prevented it, appreciate the knowledge! 

[K2retire]

I have a related question. I'm working on a takeover plan. According to the prior recordkeeper, the insurance policy was held entirely in the PS source. The plan sponsor makes the premium payments directly, which I understand counts as a contribution for the year. This year they have indicated they don't want to make a PS contribution.

Can I allocate that premium payment to the safe harbor source even if the rest of the asset is held in the PS source?

[Bird]

I say yes.  The insurance policy is, or should be, split between sources.