Reprinted from Deadline Hollywood by David Robb on September 12, 2020.
The Entertainment Union Coalition is hailing a bill signed into law by California Governor Gavin Newsom that will make it easier for workers to borrow from their employer-sponsored pension plans. EUC members include SAG-AFTRA, the California IATSE Council, Laborers Local 724, and Teamsters Local 399.
“In these difficult times, our members across California need access to their retirement funds to support themselves and their families during the current COVID pandemic,” EUC said in a statement, noting that the new law “will allow them to do that without incurring a penalty or unintended income tax payments.”
The legislation – AB 276 – which was authored by Assembly member Laura Friedman, passed through the California Legislature with unanimous support, and brings California into conformity with provisions of the federal Coronavirus Aid, Relief and Economic Security (CARES) Act, which removed penalties and improves access for those needing to take a loan from their employer-sponsored defined contribution plan. While California automatically conformed to some provisions of the CARES Act, it did not with others, creating the possibility that Californians taking a loan from their qualified retirement plan that met the requirements of the CARES Act could find themselves facing a tax penalty and unintended tax consequences for California state purposes. …