Impact of SECURE Act and CARES Act on Employee Benefit Plans

InsightsClient Alert

The Setting Every Community Up for Retirement Enhancement (SECURE) Act includes significant provisions to increase access to retirement funds.

Changes included in the SECURE Act:

  • $5,000 withdrawal available upon birth or adoption of a child
  • Required Minimum Distribution age changes from 70 ½ to 72
  • Part time employees are eligible for participation if they have worked more than 500 hours for three years

The Coronavirus Aid, Relief, and Economic Security (CARES) Act includes significant provisions to provide relief for individuals impacted by the coronavirus pandemic.

Changes included in the CARES Act:

  • Qualified participants with loan payments due between March 27, 2020 and December 31, 2020 may defer the repayment for up to one year
  • Required Minimum Distributions for participants reaching age 72 during 2020 may be waived
  • COVID-19 Related Distributions are not subject to the 10% early distribution penalty if distributions are less than $100,000
  • Eligible participants can request loans up to $100,000 or 100% of vested balance
  • Defined benefit plans with minimum funding requirements due in 2020 receive an extension until January 1, 2021

The provisions contained in these Acts have many details that need to be considered prior to adopting these changes and also require amending plan documents.

For more information, please contact our Albany office at (229) 883-7878 or our Atlanta office at (404) 220-8494.

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