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Hi. I have a 401k from an old employer (left the job about

Hi. I have a...
Hi. I have a 401k from an old employer (left the job about 4 years ago). I'm considering taking a loan against the 401k to cover some expenses for a very short period of time. I read a couple places that if you take a loan from your 401k and then leave your job, the remaining balance is due within 60 days, or else it's considered a distribution. My question is whether I'm still eligible for a loan against my 401k given that I've already left my job.
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Answered in 11 minutes by:
1/11/2013
Megan C
Megan C, Certified Public Accountant (CPA)
Category: Finance
Satisfied Customers: 16,592
Experience: Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
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Unfortunately, once you are no longer employed you cannot borrow against your 401(k). You need to be employed in order to take out the loan.

I am sorry if this is not optimal in your situation. Please let me know if you need anything additional. Thanks for using JustAnswer.com and have a happy, and safe, 2013.

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Customer reply replied 5 years ago

One minor clarification. I'm employed, just no longer at the company where my 401k is. Does that change your answer? Also, is this a provision of the company or the IRS?

Thank you for your follow up. No, that additional information does not change the answer - if you are no longer at the company where your 401(k) plan is, you cannot take a loan out. This is a rule that all 401(k) plans that allow loans have.

You can CLICK HERE to read more.

Please let me know if you need anything additional. Thanks for using JustAnswer.com and have a happy, and safe, 2013.

** Please take a moment to rate my response as "Excellent" so that I may be compensated for assisting you today. Please let me know if my assistance was anything less than "OK Service", as I am compensated based on whether or not I have assisted you with your issue. If you need further clarifications, PLEASE WAIT TO RATE MY ANSWER UNTIL AFTER RECEIVING FOLLOW UP FROM ME. If I receive anything less than OK Service, I do not get paid. Thank you for your kind understanding in this matter. If you have difficulties rating, then simply respond stating that you are having difficulties rating and thank me for my excellent, good, or ok service and we can get the rating applied by the site*
You should be aware that your question, as with most tax questions, can never really be answered completely...addressing all the permutations; that is because of the many assumptions that have to be made I have done my best to determine what I think you are asking and answering it in the most direct and understandable manner possible. If, however, after reviewing the questions, you have any uncertainties or further questions, please do not hesitate to ask.

Megan C
Megan C, Certified Public Accountant (CPA)
Category: Finance
Satisfied Customers: 16,592
Experience: Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
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Customer reply replied 5 years ago

An about.com link? Really? I appreciate the answer and still trust its accurate, but I come to the Experts on JA so I can get information that's a little more trustworthy than about.com or yahoo answers. Please only include links from the IRS or other such authorities.

Thanks for allowing me the opportunity to help you. Please let me know if I can be of any further assistance to you in this matter. Also if you ever need anything else in the future please Simply enter "MyVirtualCPA" in the subject of your question Thanks again for being a JustAnswer customer
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Megan C
Megan C
Megan C, Certified Public Accountant (CPA)
Category: Finance
Satisfied Customers: 16,592
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