A participant takes a nonqualified cash distribution from his Roth 401k account (plan terminated, age less than 59 1/2, less than 5 years participating). If income tax and early withdrawl penalties apply only to earnings on the deferrals, what happens when there is a loss on the basis?

Any resources would be helpful.
Thanks!

Generally speaking w/ Roths, a loss can only be claimed if the entire Roth is closed out. Not sure if there's specific guidance on how that principle applies to the Roth 401(k).