Can I payoff my 401K loan by rolling it over into an IRA?

It is possible and common.. when you roll anything that has an outstanding loan, the balance of the loan is deducted from the total vested balance, as money you already received.. and the taxes for said loan are deducted prior to cutting the rollover check.
So 22,000 vested balance - 2230 - 446 for federal taxes = 19324 to be rolled.. these number will change daily remember...
as well your state may require state tax be withheld, and remember if you are under 55 you will owe an additional 10 % penalty on that loan.. @ 45$ come tax filing...
This is all assuming you are eligible to roll the monies..
You state the companies sold.. but you still may not have the option to remove the funds..

This answer was edited by darlemull 31 days ago.

Reason: further info

That helps and seems to be like it will be the best course of action. I am 26 and looking at paying off all debt so i can purchase my first house come next Summer. So really, the only thing I will have to pay right now, is $45 when I file my taxes?

Provided the 20% they withhold is enough to cover the taxes on the outstanding loan.. (usually is unless you have very high income)
The rest will be coded as a rollover (make sure the check is made payable to the IRA FBO your name)
and that portion will not be considered a taxable distribution.

I by no means claim to be a financial minded person. I am not following completely. I now know that i can do it, but will have some fees and taxes, but they should not be that severe. I am guessing that once the rollover starts, I can go into a financial institution and they can walk me through the steps. Will this affect my credit?

Thank you very much for assisting!!