I am sorry for your loss. Ordinarily, loan proceeds from a retirement plan are not taxable as long as the loan is repaid. However, if an employee leaves the company before repaying the loan the proceeds then the event is treated as a taxable distribution.

Please view the section titled loans in the TurboTax link below.

https://turbotax.intuit.com/tax-tips/retirement/when-to-use-tax-form-1099-r-distributions-from-pensi...