Hardship Withdrawal

[Pammie57]

A client's employee has submitted a hardship withdrawal request. (plan does allow hardship withdrawals for safe harbor reasons) The employee/participant attached some medical bills, a notice of collection on a student loan for his son , and an estimate to install a new seer heat pump at his residence.  He lives in Portland, TN.  I assume the only allowable amounts are the medical bills not paid by insurance.  I just want to know what you think about the student loan  (approx $11,000)....   I don't think the heat pump would qualify...not a casualty loss or disaster area.  Am I missing something?  Input appreciated...

[Larry Starr]

Not missing anything; only the unreimbursed medical expenses are allowable under the safe harbor hardship rules.  The collection on a loan means there are not expenses for the next 12 months, but for some prior period, which is not part of the options.

[Pammie57]

Thank you.