Sorry, you confused a 401(k) with an IRA. Is it within 60 days? You could pay it back and start over.
You can withdraw up to $10,000 from an IRA for a qualifying "first time home purchase" and be exempt from the 10% penalty if you are under age 59-1/2. You still pay regular income tax.
A 401(k) is NOT eligible under the same law; 401(k) plans and IRAs are controlled by different tax laws and have different rules, even though they have many similarities. You could have rolled over part of your 401(k) to an IRA first then withdrawn from the IRA, but if you withdrew directly from the 401(k), the entire distribution is subject to regular income tax, plus a 10% penalty if you are under age 55.
