In response to last year's devastating hurricane season and other natural disasters, the Taxpayer Certainty and Disaster Tax Relief Act, which is a part of the Consolidated Appropriations Act, 2021 (the Act), included various relief provisions (similar to those under the Coronavirus Aid, Relief, and Economic Security Act of 2021 (CARES Act)), designed to assist individuals who suffered an economic loss as a result of these disasters. The Act, signed by former President Trump on December 27, 2020, provides individuals with increased access to their retirement plan accounts as well as plan loan and hardship distribution-related relief as described in more detail below. The relief under the Act generally expires on June 25, 2021.

Disaster Relief Distributions

The Act allows employers to amend their qualified retirement plans to permit Qualified Individuals to take one or more Qualified Disaster Distributions (QDD) from their plan accounts in connection with a Qualified Disaster. A "Qualified Disaster" generally includes any major disaster that occurred during the period starting on December 28, 2019 and ending on December 27, 2020 in an area that has been declared a "qualified disaster area" under the Robert T. Stafford Disaster Relief and Emergency Assistance Act, excluding any area declared a disaster area solely by reason of the COVID-19 pandemic. Continue reading >