Dear participant:

The Board of Trustees is pleased to announce that the Annuity Plan has been amended to allow for hardship loans. This amendment allows you to borrow a portion of your retirement savings that have accumulated in the Plan in the event that you face a hardship.

Only current participants may request a hardship loan. Former participants, alternate payees and beneficiaries are not entitled to take a hardship loan from the Plan.

Hardship Loans

You may be eligible to apply for a hardship loan if

  • You are currently participating in the Plan; and 
  • You need money to meet a certified financial need that cannot be obtained from any other source.

The definition of financial hardship is strictly defined and is limited to:

  • Expenses for medical care for you, your spouse or dependents (must provide more than half total support); 
  • Costs related to the purchase of your primary residence (excluding mortgage payments); 
  • Tuition payments and related fees for the next 12 months of post secondary education for you, your spouse, your children or dependents; or 
  • The need to prevent your eviction from your primary residence or foreclosure of a mortgage on your primary residence.

Requesting a Hardship Loan

You must submit your request for a hardship loan in writing along with documented proof that no other funds are available to meet your specific financial need. You must submit the proof requested by the Fund Office. You may contact the Fund Office for a Loan Application.

If you are married at the time of any hardship loan, you must also submit a written consent signed by your spouse and notarized. The Loan Application form provides a space for such consent.

Amount of a Hardship Loan

The Internal Revenue Code limits the amount of any hardship loan or loans collectively to the lesser of the following two amounts:

  • 50% of your account balance
  • $50,000

Other Terms

Your request for a hardship loan must be for a minimum of $ 1,000 and you may have more than one loan outstanding at a time; however, you must not be delinquent on current loans. You must repay the hardship loan within five years. You may pay off the hardship loan any time before the due date without penalty. Repayment starts in the calendar quarter immediately following the quarter in which you receive the loan.

Interest Rate

The hardship loan will bear interest at 1% over the prime rate at Amalgamated Bank of Chicago on the date your hardship loan is made. This rate will be fixed during the term of your hardship loan. Payments will be credited first to interest.


If you fail to make a payment and you fail to correct the missed payment by the last day of the calendar quarter following the calendar quarter in which you missed a payment you will be in default. If you default, you will receive a 1099 R for the outstanding hardship loan including interest. In addition to being liable for income taxes, you may also be liable for a 10% early withdrawal tax. If you default, you may not take any more loans.
If you terminated Covered Employment, you may continue to repay the loan. However, if you elect to take distribution of your account then you must repay the loan in full, including accrued interest. If you do not repay, then the loan, plus interest, will be offset against your distribution. You will still be taxable on the total.


John has $100,000 in his account at termination of employment. He also has an outstanding loan of $20,000 plus accrued interest of $1,000. John elects to receive his account in a lump sum. He will receive the following:

Account $100,000
Less loan 20,000
Less interest 1,000
Total received $79,000

John will receive a 1099 R showing a $100,000 taxable distribution even though the final distribution is $79,000.


You will be required to sign a Promissory Note and to provide any other documents required by the Trustees.

Military Service

If you enter the military and meet certain conditions, the need for you to make repayments may be suspended.

Please contact the Fund Office if you have additional questions about hardship loans.


The Board of Trustees