Plan Termination - Outstanding Loans

[Guest Christie Loeslein]

If a plan terminates and the loans not paid back are treated as distributions, are these considered involuntary therefore exempt from the early withdrawal penalty? My guess is no but I cannot find this in black and white.

Thanks!

[rcline46]

Involuntary distributions are not in the exceptions to the 10% excise tax, so the tax applies.

[Guest Christie Loeslein]

Thank you.