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I have a client that has a number of participants with plan loan problems. About half of the affected participants have terminated. I am proposing to file a VCP application and propose that the correction would be done by allowing the affected participants to reamortize their loans for up to the 5-year limit. I am also proposing that no reporting of these corrections take plan on Form 1099-R. Does anyone with experience dealing with the iRS loan corrections in VCP know if the IRS allows the reamortization approach as applied to former participants?

Thank you.

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