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Question

I took money from my 401 to pay the down payment on a new home. It looks like income. I paid the taxes at the time I took it out. How do I off set.

Forum|Forum|7 years ago
June 6, 2019
1 reply
14 views

It looks like income but it wasn't really. I paid the taxes on it when I took it out. It really decreased my return. Anyway I can it wasn't income?

TurboTax Premier Online

Level 15

Hate to give you this bad news--taking money out of a 401k for a home purchase is not an exception to the early withdrawal penalty like it would be with regular IRA. You are subject to the early withdrawal penalty plus ordinary income tax on that money you took out of your 401k even if you used it for buying a house.

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**