Yes, as @DoninGA stated, the additional 10% tax applies on an early withdrawal from a 401(k). Purchasing a home is not an exception for a 401(k).
You can, on the other hand, take out a loan on the 401(k) balance for that purpose. Most 401(k) plans allow participants to borrow their own money from the plan and repay the loan through automatic payroll deductions.
Unlike personal loans and home equity loans, 401(k) loans are usually easy to get. There's no credit check, and applications are typically short. However, they're like other types of debt in that you must pay interest on the amount you borrow. Your plan's administrator determines the interest rate, but it must be similar to the rate you'd receive when borrowing money from a bank. The good news, though, is that you are paying interest to your own 401(k) account.
Typically, 401(k) loans must be repaid within five years. That repayment period can be extended if you use the loan to purchase a home.
See this TurboTax tips article for more information.
@heatherleann89
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