While a recent rule change making 401(k) hardship withdrawals easier is being met with concern by some advisors, others believe it will help make defined contribution plans more attractive and flexible for younger savers.
On September 23, the IRS published a final rule easing some restrictions on hardship distributions from defined contribution plans, including the elimination of a six-month moratorium on plan contributions for participants who take hardship withdrawals, opening up withdrawals of plan earnings and easing the steps administrators must take to verify a participant’s hardship.
