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This answer is from changing jobs and what to do with my 401K

Michael Kitces
FiLife Contributor
about a year ago

TC,
As Ari said, if you leave your employer, you will have a limited period of time to fully repay the loan, and any amounts not repaid will be treated as an early withdrawal (with the associated taxes and potential penalties).

Unfortunately, this essentially means that if you change jobs (by choice or necessity), you may face unpleasant tax consequences if you do not have the liquidity or resources to pay off the loan at that time.

I hope that helps a little!

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