When a G76 is commanded, the lathe moves to the initial start position, then waits for the spindle speed to stabilise before syncing to the index pulse and starting the threading move.
If the speed doesn't stabilise, or the index pulse isn't seen, then Mach will hang at that point.

In the case of using an external motion controller, Mach sends the thread details to the relavant plugin, and then sits waiting for the plugin to tell Mach that the thread is finished, before continuing with the next bit of G-code.