Question

I took a loan from my 401k to purchase primary residence. are there any tax implications regarding this?

Forum|Forum|7 years ago
June 3, 2019
1 reply
0 views

No text available

Employee

If you make the payments, there are no tax issues.

If you default on the loan, or if you separate from service and don't pay the loan in full within 60 days, the outstanding balance is treated as a distribution and becomes taxable income. If you are under age 55 at the time you separate from service, you will also owe a 10% penalty.