403(b) / 457(b)Transactions/Loans: Can I pay the money back to the account to cure the default?

You can cure a default within the quarter of the year following the default. Once that quarter has passed, you cannot cure the default and the amount of proceeds outstanding on the loan at the time of default is subject to taxation.

Even though you are unable to cure the default you can repay the defaulted amount and avoid additional taxation at the time you meet a triggering event when the investment provider would be able to recoup the payment owed.

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