The IRS has issued Notice 2024-55, which provides guidance on exceptions to the additional tax on early retirement plan distributions. The notice clarifies the exceptions for distributions made to qualified individuals affected by certain disasters and for distributions made to qualified individuals affected by the COVID-19 pandemic. It also provides guidance on the recontribution of distributions made to qualified individuals affected by the COVID-19 pandemic.
The IRS yesterday released Notice 2024-55 providing guidance on exceptions to the 10% additional tax under section 72(t)(1) when taking early retirement plan distributions for emergency personal expenses and for victims of domestic abuse.
A related IRS release—IR-2024-170—explains that the exceptions were added by the SECURE 2.0 Act of 2022 and became effective on January 1, 2024.
For both the emergency personal expense and victims of domestic abuse exceptions, Notice 2024-55 provides relevant definitions, sets out the types of retirement plans for which the relief is available, describes the limitations (both dollar amount and frequency) on receiving eligible distributions, and provides that recipients are permitted to repay distributions to certain plans.
The notice also provides guidance to applicable eligible retirement plans on the plan requirements relating to emergency personal expense distributions and domestic abuse victim distributions, including that it is optional for a plan to permit these types of distributions.
In addition, the notice provides that the Treasury Department and IRS anticipate issuing regulations on the 10% additional tax (including the exceptions to the 10% additional tax) and request comments relating to the notice by October 7, 2024. Comments are specifically requested on repayments of certain distributions permitted under section 72(t)(2).
Corem ipsum dolor sit amet, consectetur adipiscing elit. Nunc vulputate libero et velit interdum, ac aliquet odio mattis. Class aptent taciti sociosqu ad litora torquent per conubia nostra, per inceptos himenaeos. Curabitur tempus urna at turpis condimentum lobortis. Ut commodo efficitur neque. Ut diam quam, semper iaculis condimentum ac, vestibulum eu nisl.Corem ipsum dolor sit amet, consectetur adipiscing elit. Nunc vulputate libero et velit interdum, ac aliquet odio mattis. Class aptent taciti sociosqu ad litora torquent per conubia nostra, per inceptos himenaeos. Curabitur tempus urna at turpis condimentum lobortis. Ut commodo efficitur neque. Ut diam quam, semper iaculis condimentum ac, vestibulum eu nisl.
Corem ipsum dolor sit amet, consectetur adipiscing elit. Nunc vulputate libero et velit interdum, ac aliquet odio mattis. Class aptent taciti sociosqu ad litora torquent per conubia nostra, per inceptos himenaeos. Curabitur tempus urna at turpis condimentum lobortis. Ut commodo efficitur neque. Ut diam quam, semper iaculis condimentum ac, vestibulum eu nisl.Corem ipsum dolor sit amet, consectetur adipiscing elit. Nunc vulputate libero et velit interdum, ac aliquet odio mattis. Class aptent taciti sociosqu ad litora torquent per conubia nostra, per inceptos himenaeos. Curabitur tempus urna at turpis condimentum lobortis. Ut commodo efficitur neque. Ut diam quam, semper iaculis condimentum ac.
Corem ipsum dolor sit amet, consectetur adipiscing elit. Nunc vulputate libero et velit interdum, ac aliquet odio mattis. Class aptent taciti sociosqu ad litora torquent per conubia nostra, per inceptos himenaeos. Curabitur tempus urna at turpis condimentum lobortis. Ut commodo efficitur neque. Ut diam quam, semper iaculis condimentum ac, vestibulum eu nisl.Corem ipsum dolor sit amet, consectetur adipiscing elit. Nunc vulputate libero et velit interdum, ac aliquet odio mattis. Class aptent taciti sociosqu ad litora torquent per conubia nostra, per inceptos himenaeos. Curabitur tempus urna at turpis condimentum lobortis. Ut commodo efficitur neque. Ut diam quam, semper iaculis condimentum ac.
