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Katrina victims gain access to retirement savings.

The U.S. Treasury and the IRS issued guidance relating to the application of two provisions of the Katrina Emergency Tax Relief Act of 2005 (KETRA). It applies to Hurricane Katrina victims and employer-sponsored retirement plans and IRAs.

KETRA individuals who live in a state affected by Hurricane Katrina receive favorable tax treatment with respect to distributions from eligible retirement plans that are qualified Hurricane Katrina distributions, called "Katrina distributions."

KETRA also increases the allowable plan loan amount from an employer-sponsored retirement plan. In addition, it provides for a suspension of payments for plan loans outstanding on or after Aug. 25, 2005, that are made to Katrina victims.

For more information, visit the IRS Web site at http://www.irs.gov.
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Title Annotation:National
Publication:Catalyst (Dublin, Ohio)
Date:Jan 1, 2006
Words:121
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