401(k) 60 days rule

[Sam Ven]

Hello,

I am looking for short term cash options for a foreclosure investment. I have 401k from my previous employer( I do have 401k with current employer as well). A friend of mine recommended to do a roll over and take the check in my name and i have 60 days to deposit back in to a 401k plan. Did anyone exercise such option? what are the risks associated with it? I was made aware about 20% tax withholding that I will get back from IRS after proving the roll over happened within 60 days. Thank you for your guidance

[Dawn Anastasi]

Instead of taking a distribution, you can take a loan from the 401(k) instead. You can borrow 50% of the balance or $50,000 whichever is less.