@RayW7 wrote:
As of this writing and included in the link below the IRS does not specify as to what type of plan to repay the funds other than an Eligible Retirement Plan. see Q7
I think the limitation will be that some outside plans might be unwilling to accept a "repayment" if the original payment did not come from them. They would have no way to know it was a repayment, they may be reluctant to accept your work without some way to verify it (since they have their own compliance requirements with the IRS to manage.)
If I were you, I would plan to repay the original 401(k). You might be able to rollover part or all of your 401(k) into a private plan after making the repayment. You might be able to find an outside plan that will accept a "repayment" but I think it will be hard to do so.
New contributions are NOT repayments. New contributions are coming out of your pre-tax wages and are reducing your tax. If you want to use that money as a repayment, you will have to stop the contributions, take the money in your take-home pay after taxes, and then send a check or electronic bank draft to the retirement plan.
