I went through a bankruptcy this past year, lost my job and had loans out on my 401k, can I be taxed on the loans that I defaulted on to my 401k?
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I went through a bankruptcy this past year, lost my job and had loans out on my 401k, can I be taxed on the loans that I defaulted on to my 401k?
Yes, you can. The bankruptcy does NOT forgive those loans nor does it mitigate the tax consequences.
You will owe income taxes to both federal and state PLUS a 10% Early Withdrawal Penalty.
Sorry!
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