Last year of March I believe, I took a loan out from my 401k and set it up as a payroll deduction to pay off the loan. A couple months before the end of last year, I received a letter from my 401k c okk money stating that there was a default with one of my loan. So the firs thing I did is call my payroll department and asked them what happen. The lady o spoke to said that it wasn't their fault and that it was the 401k company. So I called them again and they said that they even send an email to my employer to fox the problem but they never did. Considering that I'm a single mom with 5 kids, I could afford to pay off the amount of $1268 estimating amount of the default payment. So for the next following year, which is this year, I received a 1099 for the whole entire loan that they reported to the IRS. I already filed my taxes before I even received it coz I didnt get it until last week. So now I have to worry about having penalties and late fees from them. But this wast the issue, my issue was whe I got my tax from last year 2 weeks ago, I called the 401k company to see if I pay off one of the loans I have if I can reloan again. I spoke to at least 4 different representatives and I've asked them all the same questions if me having a default will affect me getting another loan. And they all said no. That it shouldn't matter coz my company allows us to get 2 loans out. The reason why I need this loan is to use for my daughter's medical condition. My daughter have crohn's disease that needs an expensive Infusion every month. I havent reach my deductible so I know I have to pay out of pocket. But because my tax wasnt enough, I called my 401k and asked them about this information. With the information they told me, I went ahead and paid off the smallest loan I have with my income tax so I can reloan for a higher amount. The representative that helped me with my payment told me to wait 7 calendar days and for me to call back on the 8th day so I can process a new loan. With all this issue going on, i spoke to my benefits manager a week ago to help me out with the setting the payment and to make sure that the payroll department isnt screwing me up again. They called me back on the day before I was gonna call to get another loan and she said because of the default that the 401k cant give me another loan. I was like, that's not what they told me. Now shes saying that because of the default with one of the loans, I cant even reinstate my account. I asked what if they take out the default amount from the new loan I'm getting g to get me caught up, would that work. She said no!!! I m sorry to say this a d use this language but they both F...ed twice! Now.my daughter is about to have her infusion by the end of this month and I dont even have the money to pay for it. Is there a way around this to protect me? I also spoke to the manager of the 401k company and they apologize to whats going on and that she'll file like a case to let me get another loan since I didn't put the stop on the loan but my employer did. So I called today a d the lady I spoke to said they cnt do anything about it. It all depends with my employer. I've been with this com pl any for 19 years and never once encountered anything like this! Please tell me if theres a way around all this and how I can reinstate my 401k to get a new loan. I also wanna see if theres a way my employer can fix the report to the IRS that its their mistake not mine.
