jabrownin
New Member

Ira withdrawal for first time homebuyer

I'm doing a withdrawal as a first time homebuyer and I am under the impression that I will not be charged penalties and fees since it's being used towards a home. However my account is suggesting a 10% tax withholding. If I choose to do this and I'm not going to get taxed, do I get it back in my end of year refund?

DoninGA
Level 15

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For a first time homebuyer you can withdraw from an IRA up to $10,000 and not incur a 10% early distribution penalty.  However, the amount withdrawn is still taxable income to be reported on your tax return.

The recommendation for tax withholding is good advice.

jabrownin
New Member

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Thank you! And I will be taxed at my regular income level, correct?

DoninGA
Level 15

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@jabrownin wrote:

Thank you! And I will be taxed at my regular income level, correct?


Correct

VolvoGirl
Level 15

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But be careful the withdrawal is added to all your income and might push you into a higher tax bracket.