rlb64 Posted January 3, 2005 Posted January 3, 2005 Participant took out a 15 yr. loan for a primary residance from a former company retirement plan. When he left that company, he paid off his loan balance by taking out a short term loan (at 18% interest). His plan was to then take out another loan from his current employer plan to pay off the short term loan and resume his "mortgage" payments. Any suggestions? Any thoughts on whether the tracing rules would help?
Guest 401der Posted January 3, 2005 Posted January 3, 2005 If he's already purchased the house, how will he satisfy the "purchase of a primary residence" to extend the loan beyond a 5 year term?
rlb64 Posted January 3, 2005 Author Posted January 3, 2005 The ERISA outline book refers Q&A 8 example under the 72p regs where a plan loan is used to repay a third party loan. This would qualify due to the tracing rules under IRC 163(h). It also says refinancing would not be permitted, so I'm not sure.
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