Plan Loan Resource Kit

This resource kit provides guidance for employer sponsors of qualified retirement plans like 401(k) plans, 403(b) tax-deferred annuity plans, and other retirement plans that allow participants to borrow funds from the plan. A plan loan program and its administration must be designed and operated both to avoid treatment of any participant loan as a prohibited transaction under the Employee Retirement Income Security Act (ERISA) and the Internal Revenue Code. The plan loan program also must meet the specific requirements of Section 72(p) of the IRC to avoid having to treat any loan as a taxable distribution. The following detailed Practical Guidance practice note, checklist, templates, and clauses will help you navigate the wide-ranging and frequently complex compliance issues facing sponsors of plans that include a plan loan program.