Retire with 401k Loan Balance
Hello. Have a client retiring in August. Has a $11,000 401k Balance. How will that be handled when he retires. Thanks.
Hello. Have a client retiring in August. Has a $11,000 401k Balance. How will that be handled when he retires. Thanks.
Permalink Submitted by Alan - IRA critic on Wed, 2021-02-03 19:34
If client cannot pay off the loan by the deadline granted by the plan, the plan will offset the loan balance as a taxable distribution with 1099R code M. The distribution is rollover eligible if he wishes to use other funds to fund a rollover contribution.