Voluntary Retirement Savings Plan (VRSP) CARES Act Withdrawal Changes

June 22, 2020
Retirement News image

The purpose of this notice is to advise retirement plan participants of a change made to the Voluntary Retirement Savings Plan (VRSP).  

Effective June 12, 2020, participants may elect distributions of tax-favored Coronavirus-related distributions (“CV Distributions”) from the VRSP only of up to $100,000, taking into account all defined contribution plans at both TIAA and Vanguard. These withdrawals are not subject to the 10% penalty that normally applies to early withdrawals and may be available from all vested account sources.  

This distribution provision is only allowed through December 31, 2020, unless extended through provisions of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. If not, effective January 1, 2021, this provision will no longer be allowed as a distribution from the VRSP. 

Participant may elect to include the amount of the CV Distributions in income over a three-year period (mandatory 20% withholding does not apply) and may also choose to repay all or a portion of the CV Distributions to a defined contribution plan within three years. 

Participant will need to self-certify that he or she is eligible for CV Distributions (i.e., has been diagnosed with the virus or disease, spouse or dependent has been diagnosed with the virus or disease, or has experienced adverse financial consequences (furloughed, reduced hours, laid off) stemming from the virus or disease. This also permits a distribution if a dependent or spouse has been diagnosed with the virus or disease. 

Please refer to your retirement plan’s Summary Plan Description (SPD) for further information regarding distributions from your retirement plan. This notice should be kept with your copy of your retirement plan’s SPD. In the event of any discrepancy between the summary contained in this notice and the plan document, the plan document will control. 

If you would like to take a distribution or have any additional questions related to this notice, you may contact the Columbia Benefits Service Center by email ([email protected]) or by calling 212-851-7000, Monday – Friday, 9 a.m.to 4 p.m. When calling, please reference this notice. 

VRSP information