Blog posted On September 05, 2018
On Aug. 17, the Internal Revenue Service released a private letter ruling that could make it easier for employers to use their 401(k) plans to assist their employees who are repaying student loan debt.
Over the last decade, student loan debt has nearly tripled in real terms and, today, Americans hold $1.4 trillion in student debt. Employees are looking for assistance in repaying their student loans, and companies have been searching for ways to tackle the problem.
The recently issued ruling affirmed that, under certain circumstances, an employer can link the amount of its 401(k) matching contributions for an employee to the amount of student loan repayments made by the employee outside of the plan.