401k Loan UPS Teamster loans

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piccarreta

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My husband is employed with UPS. We are financially unable to take out an equity loan or any other bank loan. We realized our 401k plan provides for harship loans and withdrawals. When we received the documentation it stated that not only the withdrawals could be taken for five reasons but also the loans. They do not even contribute to the plan - it is all my husbands hard earned money. Is there a way to fight them on this or get around it some how? It seems completely wrong to prevent us from borrowing against our own money. Thank you in advance for any help you can offer.
 
Because of the pre-tax element, Federal laws rigidly control 401k's as well as loans and withdrawals.

Not all 401k plans allow for loans, and if yours does you MUST stay within the guidelines set forth in the plan document. The employer CANNOT allow a loan outside the plan document limitations.

As far as withdrawals go, Federal law only permits withdrawals for very limited reasons. I am not exaggerating even a little when I tell you that allowing a withdrawal for a reason not permitted under law (or a loan permitted outside the plan document limits) could result in the entire plan being disallowed by the IRS.

There is NOTHING your employer can do and NO way around it.
 
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