Tax preparer could better help you with tax law questions, but my understanding is that loans aren’t taxable income.
Good luck on a new job. Age discrimination is rampant.
If the 401k loan isn’t paid off the balance is taxable. Not sure if it is at the rate for the age today or when you took the proceeds (10% penalty if you were under 55-1/2).An online search should help. Agree LinkedIn or Indeed are the best job search sites out there.
I think he was asking in the event he cannot keep up with the payments. If that is the case, his loan would be considered a distribution, and that would be taxable plus a pretty significant penalty.
He should absolutely go to a tax accountant. It might be worth trying to keep up the payments for at least until he is 59 1/2.
A 401k loan becomes a distribution if you don’t pay it back when yo leave the company.
not true... if a 401k loan isn’t repaid before separation it becomes a TAXABLE DISTRIBUTION and has an additional PENALTY TAX unless over age 59.5! See if you can leave the 401 assets in the plan and continue repayment of the loan term from HR or the plan docs... ymmv
I think the loans are taxable if not paid back...otherwise you would get to pay the penalty for tak8ng it out of your retirement account before age 59.