With the code of 1 in box 7 that indicates —Early distribution, no known exception (in most cases, under age 59½). So you are liable for the 10% early withdrawal penalty unless you have an exception. And your exception is a first time home purchase.
After entering your 1099-R there are multiple screens to complete.
On the screen labeled Tell us if you moved the money through a rollover or conversion you must select I didn't roll over or convert this money
You should land on a screen labeled Did you use your IRA to pay for any of these expenses? and in the box First home purchase (up to $10,000) enter the amount of the IRA distribution you used for the purchase.
