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⚠️ Solo 401k Loan Repaid? The 12-Month Rule Still Applies
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Question: I paid off my first Solo 401k loan in full. Can I borrow the full 50% again right away?
A Solo 401k loan that is already repaid can still reduce the size of the next one. Many borrowers assume a zero balance resets the cap. The look-back rule says otherwise.
Under the 12-month look-back rule, a new loan is reduced by the highest outstanding balance of any loan during the prior 12 months.
Take a $25,000 loan in month one and repay it by month four. A new loan in month six tops out at $25,000. The usual ceiling of 50% of the balance or $50,000 still applies.
My Solo 401k Financial can help members work through the math before they sign a second note.
👉 Full breakdown: 12-month look-back rule for a second Solo 401k loan
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