<prompt> Human: Without going into the rightswrongs of past choices, here is the situationSeveral years ago I took out a loan from my 401k. 2 years ago I was unemployed for a time and as money got tight, I skipped a couple payments on that loan, understanding that if I default I will have to pay taxes on the balance as retirement income. I did not receive notification that the loan was in default. Once I was employed again, I resumed and am continuing payments. I just received a letter from the IRS that I owe 2000 in taxes from retirement income claimed in 2015.Is there a way to dispute this? create payment plans? should I stop paying my 401k loan? Would Fidelity be the first place to start? or a tax lawyer? What do I ask?  <response>: sounds like they consider the default portion of your 401k loan as an early withdrawal...and you would owe taxes and penalty on the money. Do not mess around with the IRS...they can garnish your wages without going to court. I would start with a call to your HR department or 401k plan administrator. 