No, there is no deduction for the down payment on a home.
- You will owe income tax on the entire withdrawal.
- However, there is an additional 10% early withdrawal charge for people under the age of 59 1/2.
- This penalty is waved for up to $10,000 if the money is used for the down payment on a first time homebuyer withdrawal.
Please see the IRS Publication Additional tax on early distributions from traditional and Roth IRAs in the Exceptions to the 10% additional tax section.
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