PROVISIONS RELATING TO HARDSHIP DISTRIBUTIONS.

SEC. 636. PROVISIONS RELATING TO HARDSHIP DISTRIBUTIONS. (a) Safe Harbor Relief.— (1) In general.—The Secretary of the Treasury shall revise the regulations relating to hardship distributions under section 401(k)(2)(B)(i)(IV) of the Internal Revenue Code of 1986 to provide that the period an employee is prohibited from making elective and employee contributions in order for a distribution to be deemed necessary to satisfy financial need shall be equal to 6 months. (2) Effective date.—The revised regulations under this subsection shall apply to years beginning after December 31, 2001. (b) Hardship Distributions Not Treated as Eligible Rollover Distributions.— (1) Modification of definition of eligible rollover.—Subparagraph (C) of section 402(c)(4) (relating to eligible rollover distribution) is amended to read as follows: “(C) any distribution which is made upon hardship of the employee.”. (2) Effective date.—The amendment made by this subsection shall apply to distributions made after December 31, 2001.115 STAT. 118