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Thank you in advance for any advice!

Pretty simple question:

  1. I have an existing plan with my previous employer, I am no longer with them.
  2. I have a outstanding loan on that plan.
  3. I am setting up a new plan under my own LLC, a Solo 401k.
  4. current plan will not let me transfer the loan, and will also no longer allow me to make payments against it....so it IS going to default and there seems to be nothing I can do.
  5. Can I borrow money to pay off the current plan (from my HELOC), move all the funds, then take out a new loan from the new plan to pay off the HELOC?

The original loan was opened in Sept 2023 for 50k Do I have to wait until after sept of 2024 to take out a loan from the new plan? It seems that if it is with a different company completely maybe not....?

I have researched this a lot but cannot seem to find it.

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current plan will not let me transfer the loan, and will also no longer allow me to make payments against it....so it IS going to default and there seems to be nothing I can do.

You can pay it off, obviously, defaulting would be very expensive tax wise.

Can I borrow money to pay off the current plan (from my HELOC), move all the funds, then take out a new loan from the new plan to pay off the HELOC?

You can definitely do the first part (borrowing from HELOC to pay off the 401k loan to avoid the tax hit).

Re the second part it depends on the new plan documents and what it allows. Since you're setting it up - you can confirm what they say and what they allow. Here's the IRS FAQ on what plans need to consider with regards to loans.

Do I have to wait until after sept of 2024 to take out a loan from the new plan?

Not if your plan doesn't require that.

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    Remember that 401k loans are less advantageous than they may seem. Yes, you are theoretically paying yourself the interest, but you are losing the tax-advantaged growth that money would have experienced if it stayed in the retirement fund. Probably should be reserved for emergencies rather than normal borrowing.
    – keshlam
    Commented Jun 20 at 16:26

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