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    noratrace's Avatar
    noratrace Posts: 1, Reputation: 1
    New Member
    		  
    #1

    Mar 12, 2007, 09:04 AM
    Loans from 401k after rtirement
    If I retire at age 60 and I still have an outstanding loan from my 401k, can the outstanding loan amount be treated as income and I pay tax on that amount at the yearly tax return time?
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
    		  
    #2

    May 11, 2007, 01:15 PM
    Yes, the balance of the loan will be treated as a distribution on which you will pay taxes as ordinary income. Fortunately, no 10% Early Withdrawal Penalty will be due.
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