CARES Act provisions

[Belgarath]

If a plan does not ALREADY allow for loans, or hardship/in-service for that matter, must the plan amend to allow loans by 12/31/2020, and then subsequently (or concurrently) add the Coronavirus provisions, or can the entire loan provision have the extend deadline of 12/31/2022?

[mattmc82]

from my understanding - these can be allowed on their own. so a plan can have no inservice no loans and no hardships but allow cares act transactions

[Belgarath]

Thanks. That's what I was thinking (my original thought was that a "regular" amendment would be required first) but after thinking about it a bit, I realized this didn't make any sense.

[susieQ]

So a plan that does NOT currently permit loans but wants to take advantage of the CARES loan options, if they do not create a "regular" amendment now to add a loan provision, will be making loans available to ONLY Coronavirus affected/eligible  participants, right?  The future amendment will only address the Coronavirus type loan, loans to "eligible" participants, right?   In other words, the future amendment won't have language that makes loans available to all  participants, correct?  

[RPAS]

Correct. You would need to add a separate amendment if you want to allow loans outside of the CARES Act loan since they are separate features. 

[Luke Bailey]

I think if your plan document does not permit loans, you will need to amend if you want to make CARES Act loans, but the amendment does not need to be made until 2022 plan year. In the interim, you can just have/administer loans, but a guiding document of some sort, even if not a formal plan amendment, is HIGHLY advisable.

The IRS and/or DOL will presumably clarify the above in guidance.