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Retirement tax questions
It sounds like it is correct. The rollover is not taxable. The IRA withdrawal is taxable. If this was a first time home purchase, then the penalty is waived. You still have to pay the ordinary income tax on the disbursement, but the 10% penalty is waived. When you look at your Form 1040, you should see $18K is retirement income, but only $9K on the taxable line, which sounds like what you described above. There should be no penalty for either transaction.
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March 18, 2020
9:51 AM