An interior Revenue provider (IRS) Chief Counsel Advice memo issued to aid counsel in just one of the agency’s offices that are regional
The memo, dated August 30, offers two pictures sexactly howing how missed installments can be composed without penalty. One utilizes a later on, bigger re payment plus the other employs an alternative loan. Both circumstances happen in the hypothetical plan’s stated loan remedy duration.
Two Examples Provided
Both examples derive from the important points that: (1) the 401(k) plan at issue allows plan loans and permits for a remedy duration; and (2) that on January 1, 2018, the participant obtains an agenda loan that will not meet or exceed the permitted limitation on such loans, just isn’t a mortgage, has a legitimately enforceable agreement, and it is repayable in equal installments at the conclusion of every month for the agreement, which can be amortized over five years.