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Can an ex spouse take a hardship withdrawal to buy out her ex husbands share of their primary residence home? 
thanks!

Posted

Is buying out the former spouse “[c]osts directly related to the purchase of a principal residence for the [participant]”?

26 C.F.R. § 1.401(k)-1(d)(3)(ii)(B)(2) https://www.ecfr.gov/current/title-26/part-1/section-1.401(k)-1#p-1.401(k)-1(d)(3)(ii)(B)(2).

Is buying out the former spouse “necessary to prevent the eviction of the [participant] from the [participant’s] principal residence”?

Is buying out the former spouse “necessary to prevent . . . foreclosure on the mortgage on [the participant’s principal] residence”?

26 C.F.R. § 1.401(k)-1(d)(3)(ii)(B)(4) https://www.ecfr.gov/current/title-26/part-1/section-1.401(k)-1#p-1.401(k)-1(d)(3)(ii)(B)(4).

Peter Gulia PC

Fiduciary Guidance Counsel

Philadelphia, Pennsylvania

215-732-1552

Peter@FiduciaryGuidanceCounsel.com

Posted

If claims for a hardship distribution are processed under a § 401(k)(14)(C) certification, a claimant might believe, in her circumstances, that buying out the former spouse’s interest in the participant’s principal residence fits one (or more) of those deemed-hardship situations.

And a plan’s administrator might not “ha[ve] actual knowledge to the contrary of the employee’s certification[.]”

Peter Gulia PC

Fiduciary Guidance Counsel

Philadelphia, Pennsylvania

215-732-1552

Peter@FiduciaryGuidanceCounsel.com

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