Spousal Consent for Participant Loan

[Guest Jane Freeman]

I have the following situation and need assistance in determining whether spousal consent is required for the loan:

401(k) Plan subject to J & S rules

Participant has current outstanding loan balance of $1100 and is taking a second loan for $4900. The second loan by itself is less than $5000 but the second loan will bring the total outstanding loan balance (and accrued benefit used as security for the loans) over $5,000. Is spousal consent required on the second loan?

Any help would be greatly appreciated.

Thank you.

[david rigby]

I think the correct cite is IRS Reg. 1.401(a)-20, Q&A 24.

http://ecfr.gpoaccess.gov/cgi/t/text/text-.../26cfrv5_02.tpl