Yes, you may spread the taxable amount of the distribution over three years. If you decide the claim 1/3 of the distribution this year, you need to file an Idaho state return for the following two years so that Idaho can capture the tax from the full amount of the distribution.
Idaho, in in full conformity of the federal tax code as it reports 1/3 of the distribution this year. It begins with reporting the federal AGI, which includes 1/3 of the distribution.
As far as for the purchase of the home, this only waives the 10% early withdrawal penalty and doesn't affect regular taxation either on the federal or state level.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
