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Dealing With Loan Defaults [2016]
Presentor: Derrin Watson Recorded Date: 4/20/2016 Duration: 60 Min.

Description
This program was recorded during a live presentation given on April 20, 2016 at 12:00PM EST.
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Administering participant loans is one of the least rewarding and most challenging aspects of retirement plan practice. Many practitioners would just as soon eliminate loans from the plan. However, loans continue to be one of the more popular plan features.

In today’s difficult economic times, plans are experiencing more loan defaults. When a participant defaults on a loan, the plan must address the following issues: Can I offset the loan? What is the difference between a loan offset and a deemed distribution? How do I report a deemed distribution and a loan offset on Forms 1099-R and 5500? How do I account for the defaulted loan?

We address these questions and others, such as: When is a defaulted loan a prohibited transaction? How do I correct a failure to withhold? If the employer fails to deposit the loan repayment is it a default? This web seminar provides you with a better understanding of how to administer loans properly.

Topics include:

  • Loan offset vs. deemed distribution
  • Grace period
  • Reporting defaults
    • Deemed distribution vs. loan offset Phantom interest
    • Offset following deemed distribution
  • Loan acceleration
  • Delinquent deposit of loan repayments
    • Excise tax calculation
  • Impact of bankruptcy
  • Impact of death
Prerequisites:

There are no prerequisites or advance preparation for this program. However, the instructor will assume attendees are familiar with the basics of handling plan loans. At least 1 year of experience is recommended.

Level: Intermediate

Instructional Delivery Method
Group – Internet-Based

NASBA Field of Study: Taxes

Speaker: S. Derrin Watson, J.D.
Recipient of ASPPA's 2006 Educator of the Year Award

Prerequisites:

There are no prerequisites or advance preparation for this program. However, the instructor will assume attendees are familiar with the basics of handling plan loans. At least 1 year of experience is recommended.

Level: Intermediate

Instructional Delivery Method
Group – Internet-Based

NASBA Field of Study: Taxes

Speaker: S. Derrin Watson, J.D.
Recipient of ASPPA's 2006 Educator of the Year Award

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