IRS Opens Door for 401(k) Sponsors to Address Student Loan Debt


Jeffrey Holdvogt said that an Internal Revenue Service private letter ruling allows an employer to add a 5 percent contribution to a participant’s 401(k) account if that participant verifies sufficient student loan repayments. “The benefit does not directly pay down an individual’s loan debt,” he clarified. Mr. Holdvogt and Sarah Engle recently authored an On the Subject on this private letter ruling.