Interesting loosening of 401K restrictions in stimulus bill

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helloeveryone
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Interesting loosening of 401K restrictions in stimulus bill

Post by helloeveryone » Thu Mar 26, 2020 9:54 am

This is an interesting provision in the stimulus bill. The quote is from a WSJ Article -Retirees Get Relief in Senate Coronavirus Stimulus Package

“Pro­vi­sions in the Sen­ate leg­is­la­tion raise the lim­its on 401(k) loans and loosen the rules on hard­ship dis­tri­b­u­tions from re­tire­ment ac­counts. Peo­ple af­fected by the coro­n­avirus cri­sis would get ac­cess to up to $100,000 of their re­tire­ment sav­ings with­out the 10% penalty that nor­mally ap­plies to money taken out be­fore age 59 1/2.”

Would this be an additional tool to take some money out of 401K and put it in taxable and let it grow long term? Or would that be a bad idea because dividends would get taxed now all the way until retirement? Or perhaps it’s not helpful since you can do backdoor roths?

I just wanted to start a discussion what BH would do with this new rule. (if you would do anything with this)

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prudent
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Re: Interesting loosening of 401K restrictions in stimulus bill

Post by prudent » Thu Mar 26, 2020 9:58 am

Discussion not permitted until there is a signed law.

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