Cares Act Distribution and interaction with 1 year wait after termination

[Purplemandinga]

If a plan document requires terminated participants wait 1 year before they take a distribution, would implementing the Cares Act in the plan require the plan document to be amended to shorten the time terminated participants have to wait in order to get their money sooner than 1 year? 

 

EDIT: I just wanted to clarify that the participant was terminated because of Covid, so they would be a qualified individual.

[CuseFan]

CRDs are temporary, so no, you would not want to generally amend distribution timing unless you wanted to keep it that way. Just amend for CRDs by 2022 deadline, but be sure to do so in conformity with how the plan was administered, whether to the fullest extent of the law or on some other restricted basis.

[Luke Bailey]

Purplemandinga, completely agree with CuseFan on substance, but note that CuseFan is not in fact saying the plan does not have to be amended, just that it does not need to be amended either immediately or permanently. It does need a temporary, or "pop-up" amendment, as it were, adopted by the end of 2022, but effective only for 2020.