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Hello trp:

You almost got it but not quite. The IRC giveth & the IRC taketh away; as follows:

1. §4975(a), (b) & (c) particularly (c)(1)(B) make the loan between the plan and you (or your spouse) a prohibited transaction.

2. §4975(d)(1) seems to (or temporarily) bring back the loan ability as long as the loan environment is level for all participants in the plan.

3. However, §4975(d)starts with "except as provided in (f)(6)" which is the "taketh away" part and says "shall not apply to a transaction which...(i) such owner-employee..."

Admittedly confusing as this is an "out-in-out" section of the IRC. Bottom line, you may not, under any circumstances, make a loan to yourself from the plan.


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