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Congressman Thaddeus McCotter introduced a bill that would allow a $50K loan from your retirement account.
QUALIFIED HARDSHIP LOAN- For purposes of this subparagraph, the term ?qualified hardship loan? means any distribution to an individual from a qualified individual retirement plan of such individual upon hardship of such individual (within the meaning of section 401(k)(2)(B)(i)(IV)) if one or more contributions to a qualified individual retirement plan of such individual in an aggregate amount equal to such distribution are made during the 5-year period beginning on the date of such distribution.
QUALIFIED INDIVIDUAL RETIREMENT PLAN- For purposes of this subparagraph, the term ?qualified individual retirement plan? means an individual retirement plan other than a Roth IRA.
LIMITATION ON AMOUNT OF LOAN- Such term shall not include any loan unless the amount of such loan (when added to the outstanding balance of all other hardship loans from Qualified individual retirement plans of such individual) does not exceed $50,000.
I would ask that we go to http://www.congress.org and write our representatives and ask:
LEGISLATION H.R. 1628
Could your legislation allow another option?
Allow the unemployed to draw interest or dividends from their 401k, IRA's without penalty (Not the principle) for up to 36 months. Hopefully, this will provide enough time for them to find new jobs.
This would help them forestall taking SS early or losing their home, help pay for for utilities, insurance... without diminishing the principle balance of the accounts