Student Loan

[JustMe]

I know that there isn't much guidance, but some help from you all would be greatly appreciated.  If an employer wants to implement a setup similar to Abbott Labs (2% loan repayment, 5% "match" to 401(k) plan) and the plan has individual rate groups for a profit sharing allocation, is there a need to amend the plan to allow for this setup?  Or is the contract for the "match" for student loan repayments outside of the 401(k) plan and the "match" is really just a discretionary contribution to the PS plan by the employer?

[Larry Starr]

On 3/13/2020 at 5:22 PM, JustMe said:

I know that there isn't much guidance, but some help from you all would be greatly appreciated.  If an employer wants to implement a setup similar to Abbott Labs (2% loan repayment, 5% "match" to 401(k) plan) and the plan has individual rate groups for a profit sharing allocation, is there a need to amend the plan to allow for this setup?  Or is the contract for the "match" for student loan repayments outside of the 401(k) plan and the "match" is really just a discretionary contribution to the PS plan by the employer?

You got it! It is a discretionary employer contribution and the plan document has not direct connection via written provisions to the external reason (student loan payment) for the employer contribution.

[JustMe]

Great, thank you so much!