NC 401(k)/NC 457 Plans' Federal Disaster Relief Resources

1. Was your primary residence located in the FEMA-designated area during the incident period and at the time the Emergency Declaration was declared? Visit FEMA’s Disasters and Other Declarations to search for Incident Period and Designated Area.” 
    

2. Did you suffer any economic loss due to the declared disaster? See the examples below.

   • Damage to, or destruction of, your home.

   • Damage to, or destruction of, your car.

   • Damage to, or destruction of, your personal property.

   • Cost of being displaced from your home.

   • Loss of income (e.g., from a temporary or permanent job loss) 

   If your answer is “Yes” to both questions below, you are eligible to withdraw up to $22,000 per disaster from your NC 401(k) or NC 457 Plan account to help with your disaster recovery. If you have accounts in both plans, you can take distributions from either or both plans; however, the total amount you can take from both plans combined is capped at $22,000 per disaster.  In addition, the $22,000 maximum is reduced by the amount you withdraw from other plans or IRAs.

You may withdraw up to $22,000 from your NC 401(k) or NC 457 Plan account to help with your recovery. If you have accounts in both plans, you may take distributions from either or both plans; however, the total amount that you may take from both plans combined is $22,000. The disaster recovery distribution limit is per declared disaster. In addition, the $22,000 maximum is reduced by the amount you withdraw from other plans or IRAs.

You only need to certify that you are eligible to take a disaster recovery distribution. You do not need to provide any documentation. 

Yes. You can take any number of disaster recovery distributions from the NC 401(k) and/or NC 457 Plans, so long as the total amount of money withdrawn from the NC 401(k) and NC 457 Plans combined does not exceed $22,000 per disaster. In addition, the $22,000 maximum is reduced by the amount you withdraw from other plans or IRAs.

If you received a qualified disaster distribution, it is taxable but isn’t subject to the 10% additional tax on early distributions. However, the distribution is included in income ratably over 3 years unless you elect to report the entire amount in the year of distribution.

No. A distribution is not subject to the 10% tax penalty that generally applies if a participant younger than 59⅟2 withdraws money from a 401(k) plan. 

Yes. If you take a disaster recovery distribution from the NC 401(k) or NC 457 Plan, you are allowed (but not required) to recontribute some or all of this amount to the NC 401(k) Plan or the NC 457 Plan. You have three years from the date of your distribution to recontribute some or all of the distribution. 

In addition, you may be able to recontribute some or all or the amount of your NC 401(k) or NC 457 Plan distribution to another retirement plan, but you will need to check with the retirement plan before recontributing. Likewise, if you take a disaster recovery distribution from another retirement plan, you may be able to recontribute it to the NC 401(k) or NC 457 Plan. For more information, consult a tax professional or refer to Form 8915-F and Instructions for Form 8915-F on the Internal Revenue Service’s website (www.irs.gov). 

If you are eligible for a disaster recovery distribution, you also may be eligible for a loan from your plan account. Call 1-866-627-5267 (1-866-NC-PLANS) for more information.