401k loans and bankruptcy

[legort69]

A participant files for bankruptcy and has a 401k loan. Are loan repayments disallowed in the bankruptcy and loan is defaulted - deemed distributed (taxable as income and penalty) or something other than the above?

[FundeK]

I really hate to do this, because I hate when I get this reply, but....try doing a search using "bankruptcy". Try the 401(k) forum and the distribution and loan forum. You will get a lot of good information.

[Kirk Maldonado]

FundeK:

You shouldn't feel bad about posting your reply. I think that it was entirely appropriate.

I think that the first post that everybody makes should be to check to see if the person searched the message boards before posting the question. My belief is that extremely few do.

The second post should be to ask that person's analysis of the issue, if they didn't include it in their initial post.

I don't believe that these Message Boards should be used by lazy people to try to get others to do their work for them. They should be used where there aren't any answers, the answers seem inconsistent, the analysis underlying the answers seems incorrect, etc.

[legort69]

Thanks, your response helped. I am relatively new to the Benefit Site as far as taking advantage of its historical archive searches so I didnt even know to look there and it wasnt a matter of being lazy, just a little inexperienced. I will know better for the next time.

[Kirk Maldonado]

legort69:

You brought up a good point. I had assumed that everybody knew about the search feature and how to use them. That was clearly a mistake on my behalf and I am sorry if my heavy-handed remark offended you.

I am not very tolerant of people that waste everybody's time rather than spend one minute searching for the answer. I consider that to be lazy and selfish. However, that assumes that they knew about the search function, which, as you quite correctly pointed out, may not be known by all of the users of the message boards.

I need to mention to Dave Baker that he should undertake steps so as to make the search function more visible, and to possibly give the reader a cue to use the search function before opening a new thread.