On November 14, 2018, the IRS issued proposed regulations about the new hardship withdrawal rules that generally became effective January 1, 2019. The proposed regulations:

• Clarify that a hardship exists for a casualty loss that is unrelated to a federally-declared disaster
• Add a new optional category for permitting hardship withdrawals for FEMA-declared disasters
• Confirm that the six-month suspension required in the past for employee contributions may be eliminated as of January 1, 2019 but must be eliminated as of January 1, 2020
• Permit plans to eliminate the condition that participants first exhaust their borrowing privileges
• Allow additional portions of an account to be withdrawn in case of a qualifying hardship, including the gain on 401(k) contributions, but not the gain on 403(b) contributions
• Adjust the rules for what a participant must provide as part of a request for a hardship withdrawal