IRS Issues FAQs on Disaster Relief Under SECURE 2.0

Published May 06, 2024

The Internal Revenue Service (IRS) issued frequently asked questions (FAQs) in Fact Sheet 2024-19, relating to rules for distributions from retirement plans and IRAs and for retirement plan loans, for certain individuals impacted by federally declared major disasters.

The FAQs relate to the SECURE 2.0 Act of 2022 (SECURE 2.0) provision that provides for ongoing disaster relief for certain distributions and loans in the case of federally declared major disasters. Prior to the changes made by SECURE 2.0, there was no disaster relief allowing these distributions and loans that applied generally for all major disasters.

The FAQs are intended to assist individuals, employers, and retirement plan and IRA service providers, and they are divided into four categories:

  • General information;
  • Taxation and reporting of qualified disaster recovery distributions;
  • Repayment of qualified distributions taken for the purpose of purchasing or constructing a principal residence in a qualified disaster area; and
  • Loans from certain qualified plans.