Page 65 - AprDefComp

Optional Provisions of CARES Act

1. Allow Coronavirus Related Distribution (“CRD”) penalty free from Eligible
Retirement Plans.
Qualifying participants must certify they meet at least one of the following conditions:
 Diagnosed with SARS-CoV-2 or COVID-19 by a test approved by the Centers for Disease
Control and Prevention
 Spouse or dependent is diagnosed with SARs-CoV-2 or COVID-19
 Experiences adverse financial consequences as a result of being quarantined because of
the virus or disease, being laid off or furloughed or having work hours reduced because of
the virus or disease, being unable to work due to lack of child care because of the virus or
disease, closing or reducing hours of a business owned or operated by the individual
because of the virus or disease, and other factors as determined by the Secretary of the
Treasury

Note: A participant who meets any of the requirements above is considered a “Qualified
Individual”

Administrative information regarding the CRD:
 Plan administrator may rely on self-certification by the participant to approve the
distribution
 The CRD is not considered a Hardship distribution; therefore, Hardship restrictions do not
apply
 The distribution is capped at $100,000 for any taxable year
 Coronavirus-related Distribution is a distributable event under the following Plans – 401(a),
401(k), 403(b) and Governmental 457(b) Plans
 Taxable amount may be spread equally over 3 tax years (if participant so elects)
 10% penalty excise tax doesn’t apply to the distribution
 The distribution is not an Eligible Rollover Distribution
 The Special Tax Notice (402(f) Notice) is not required
 The mandatory tax withholding on any distribution is not required
 The voluntary 10% tax withholding will apply, unless not elected
 These specific distributions may be repaid over 3-year period starting from the date in
which the distribution was made.
 Repayments are remitted to the plan as rollovers

2. Temporary Maximum Loan Amount Increases up to $100,000
Loans made to a Qualified Individual during the 180-day period beginning on March 27,
2020, may be made in amounts up to the lesser of $100,000 (reduced by the highest
outstanding loan balance over the 12-month period preceding the distribution) or the
participant’s fully vested account balance.

P a g e | 4 | RS-49007-00
This document is intended for Plan Sponsor and Third-Party Administrator use only. Not intended for Participant
use.
Massachusetts Mutual Life Insurance Company (MassMutual), Springfield, MA 01111-0001,and it affiliated US
insurance companies