@savjordan wrote:
Hello Carl. I was reading through all the replies regarding early withdrawal from a 401K account to purchased a 1st time home. To my understanding, only a max of $10,000 can be qualified and applied to IRS. My husband did withdraw from his 401k account and used the whole amount he withdrew to put in as a down payment for our first home purchase, but the amount is more than $10,000. My question is do we enter ONLY the $10, 000 amount on the IRS form or do we enter ALL the amount he withdrew in the "Other" interview questions box as an exception. I just want to make sure we are doing it correctly.
Sorry, there is not a 10% early distribution exemption for a first time home purchase from a 401(k). That is only available if the funds were withdrawn from an IRA.
See this IRS tax topic - https://www.irs.gov/taxtopics/tc557
You enter the Form 1099-R as received. If there is an 10% early distribution penalty it will calculated and entered on the Form 1040 as a tax liability by the TurboTax software.
The taxable amount of the distribution entered in box 2a of the Form 1099-R is entered on the tax return as ordinary income and taxed at your current tax rate. Any federal taxes withheld and entered in box 4 of the 1099-R are entered on the federal tax return Form 1040 as a tax payment.
To enter, edit or delete a form 1099-R -
- Click on Federal Taxes (Personal using Home and Business)
- Click on Wages and Income (Personal Income using Home and Business)
- Click on I'll choose what I work on (if shown)
- Scroll down to Retirement Plans and Social Security
- On IRA, 401(k), Pension Plan Withdrawals (1099-R), click the start or update button
Or enter 1099-r in the Search box located in the upper right of the program screen. Click on Jump to 1099-R
