Question

If we didn't get a 1099-R from taking out a loan from his 401, should we have?

Forum|Forum|5 years ago
February 7, 2021
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TurboTax Deluxe Online

Employee

A loan from a 401K is not considered a taxable transaction as long as you are repaying the loan according to the terms of the loan. Therefore you would NOT receive a 1099-R as long as you make all your payments in a timely fashion, and there would be nothing to report on your tax return.

If the loan became delinquent, the unpaid balance could become a deemed distribution. If that happened you would receive a 1099-R and the distribution would be taxable.

**Answers are correct to the best of my ability but do not constitute tax or legal advice.