The bank I work for and have a loan on my 401k with was closed by FDIC. The forced distribution for the loan payoff is not my decision to take. Is there any tax break consideration by the IRS.

You had a choice You could have rolled over the full amount of the distribution into an IRA or new company account. So the distribution was not entirely forced. When I lost my job at the end of 2008, I used part of my severance to pay off the loan balance.

So, since you did have a choice, there are no considerations here.

Please clarify - what was "closed by the FDIC?" Did you lose your job? If so, then unfortunately this is a consequence of having a loan outstanding. If you are no longer employed, you must pay back the loan or it will be reclassified as a withdrawal, and hence subject to income tax and the 10% early withdrawal penalty (if you are under age 55).