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    tacojuice's Avatar
    tacojuice Posts: 1, Reputation: 1
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    #1

    Feb 2, 2007, 12:10 PM
    401k loan
    My husband took a LOAN for $3000 from his 401k in August. He has and will continue to have approx. $15 a week taken from his paycheck over a 5 year period. There is an interest rate of 9.2 percent. He has not received a 1099-R. Should he have? How do I handle filing 2006 taxes?
    Thank You
    Fr_Chuck's Avatar
    Fr_Chuck Posts: 81,301, Reputation: 7692
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    #2

    Feb 2, 2007, 12:48 PM
    A loan from a 401K is not like taking money out. From time to time I borrow against my account for special things when I need short term finance. If I stop paying back the loan, then it is considered a withdraw but not as long as you do not default on the payments

    It should have no effect on income tax filing as long as it was a LOAN and not a withdraw

    I am sure Atlanta Tax will be here shortly to confirm this also, and perhaps explain it in better tax terms
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
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    #3

    Feb 2, 2007, 10:39 PM
    Fr Chuck:

    I have nothing to add. Your explanation was exemplary! :-)
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