Plan Loan - distribution following leave

[Guest DTromb]

A participant takes a plan loan, makes two payments, and then goes on an approved, unpaid leave. The plan allows for suspension of payments during the leave, up to 12 months.

After six months of leave the participant terminates their service and requests a distribution. Will the loan offset include the six months accrued interest during the leave? In otherwords, is the participant taxed on the accrued interest amount?

Thanks.