COVID-19 Impact and the CARES Act

On March 27, 2020, the U.S. president signed the Coronavirus Aid, Relief, and Economic Security (CARES) Act into law. The more than $2 trillion package seeks to address financial pressures facing individuals, businesses, and state and local governments due to the pandemic.

For CARES Act distribution and loan provisions, a qualified individual is one who:

  • is diagnosed with the virus SARS-CoV-2 or with coronavirus disease 2019 (COVID-19) by a test approved by the Centers for Disease Control and Prevention,
  • has a spouse or dependent diagnosed with such virus or disease, or
  • experiences adverse financial consequences as a result of being quarantined, being furloughed or laid off, or having work hours reduced due to such virus or disease, being unable to work due to lack of child care due to such virus or disease, or other factors as determined by the Secretary of the Treasury.

If you fit these criteria, provided below are some allowances and relief options that may apply.

CARES Distribution

Allows participants who meet the CARES Act criteria to take penalty-free withdrawals of up to $100,000 from eligible retirement plans and IRAs from January 1, 2020, through December 30, 2020.


Increases the maximum loan limit for qualified participants to the lesser of 100 percent of the vested account balance or up to $100,000 (reduced by the highest outstanding loan balance within the past 12 months) from March 27, 2020, through September 23, 2020, from all plans of the employer and any related employer. The first payment date on the loan is deferred until January 2021.

Minimum Required Distribution (MRD)

Waives MRD rules for all types of defined contribution plans—including 401(k), 403(b), and governmental 457(b) plans, but excluding 457(b) plans sponsored by tax-exempt entities—and individual retirement accounts (IRAs) for calendar year 2020, providing relief to individuals who would otherwise be required to withdraw funds from such retirement accounts during an economic slowdown due to COVID-19.

To initiate the CARES distribution and/or the CARES loan, or find out more about the tax implications, please contact Fidelity directly by phone (800-343-0860) or by logging into your accounts online.

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Board of Benefits Services
475 Riverside Drive, Suite 1606
New York, NY 10115