Mutual funds

[lewjaz1]

I used money from a mutual fund to purchase a home.  The entire amount withdrawn was used for the purchase.  Is this taxable, and how? It is appearing as ordinary income.

[DoninGA]

Yes, the amount distributed is entered as ordinary income and taxed at your current tax rate.

There is an exception to the 10% early distribution penalty if the funds were withdrawn from an IRA and used for the purchase of a first home.  But only the amount up to $10,000 is eligible for the exclusion.  The distribution is still a taxable event and reported on a tax return as ordinary income.

[Bsch4477]

Was the fund in a retirement account? If so, it is taxed as ordinary income. If from an IRA you can be exempt from the early withdrawal penalty, however.