this is a really long story - but to just cut to the chase, I had a loan deem on my 401K account about 6 years ago due to my employers' error to make the necessary payments from my paycheck. I had tried every which way to have them fix this and was told there was no way to fix it - I paid the penalty and taxes on it back then - not realizing, of course, that this would stay on my account FOREVER (until I retired, etc.) and would limit any other loans I could take. I am now wanting to do a early partial distribution in the amount of $50,000 (I know about the penalty and taxes since I am not 59 1/2 yet) - my question is - will the deemed loan have to be paid out of that early distribution that I take or since there will still be plenty in the account to cover the loan - can that be done when I turn 59 1/2 and get a full distribution? Hope all of that makes sense. thanks in advance!
