A national gay rights group hailed President Bush's signing on Thursday of the federal Pension Protection Act, a new law that includes two provisions that extend important financial protections to more Americans, including same-sex couples. "This is an incredibly exciting victory that will be helpful to millions of gay, lesbian, bisexual, and transgender families," said Joe Solmonese, president of Human Rights Campaign.
Solmonese noted that HRC fought hard to have the two provisions included in the final version of the measure. "Basically, what this means is that these two provisions ensure that the U.S. tax code, in times of emergencies, is fairer to more Americans, including our community," he said, "and puts us on a more equal footing with other couples."
The first provision, called "Non-Spousal Rollover," allows for transfer upon an individual's death of their retirement plan benefits, like a 401(k), to an Individual Retirement Account (IRA) for a nonspouse beneficiary, like a domestic partner, sibling, or any other designated person. In the past, gay partners were forced to withdraw the amount as a lump sum and faced immediate tax penalties, which diminished savings intended for retirement.
The second provision, known as "Hardship Distribution," allows individuals who list their same-sex partner or other nonspouse beneficiary under a 401(k) plan the ability to tap into their retirement funds in the case of certain medical or financial emergencies of the beneficiary. In the past, federal law permitted such withdrawals only for employees' legally recognized spouses or dependents. (The Advocate)
