TPApril Posted June 5, 2024 Posted June 5, 2024 one-person plan in which owner has a loan with quarterly payments. They want to push off loan payments by a quarter. Doesn't seem right, but in so doing, they never default. What could go wrong?
Bill Presson Posted June 5, 2024 Posted June 5, 2024 I think they misunderstand the cure period. The end of the quarter after the missed payment is the time to have all payments caught up. Not just the missed payment. https://www.irs.gov/retirement-plans/issue-snapshot-plan-loan-cure-period Luke Bailey 1 William C. Presson, ERPA, QPA, QKA bill.presson@gmail.com C 205.994.4070
TPApril Posted June 5, 2024 Author Posted June 5, 2024 Thanks! That's what I needed! Their other circular question was - should they take an allowable in-service distribution to pay off the loan, rather than defaulting and thereby having an outstanding unpaid loan balance within the plan which would limit future loans.
Popular Post CuseFan Posted June 5, 2024 Popular Post Posted June 5, 2024 18 hours ago, TPApril said: one-person plan in which owner has a loan 18 hours ago, TPApril said: What could go wrong? I think your first statement was the answer to your question, LOL, as these situations often get treated like they are personal bank accounts rather than QPs, IMHO. DMcGovern, acm_acm, Bill Presson and 2 others 3 2 Kenneth M. Prell, CEBS, ERPA Vice President, BPAS Actuarial & Pension Services kprell@bpas.com
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