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Hey I had to withdraw from my 401k at the end of last year. I did this to help pay for closing costs on a home, can I use this for write off?
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Hey I had to withdraw from my 401k at the end of last year. I did this to help pay for closing costs on a home, can I use this for write off?
No. There is no exception for the 10% early withdrawal penalty for closing costs funded from a 401(k) account. The withdrawal is taxable as ordinary income on your tax return and based on your age you may also have a 10% early withdrawal penalty liability on your tax return.
Only funds withdrawn from an IRA are eligible for the early withdrawal exception and only for a first time home purchase and limited to $10,000.
See this IRS tax top topic for early withdrawal exception for distributions from other than an IRA - <a rel="nofollow" target="_blank" href="https://www.irs.gov/taxtopics/tc558">https://www.irs.gov/taxtopics/tc558</a>
Only funds withdrawn from an IRA are eligible for the early withdrawal exception and only for a first time home purchase and limited to $10,000.
See this IRS tax top topic for early withdrawal exception for distributions from other than an IRA - <a rel="nofollow" target="_blank" href="https://www.irs.gov/taxtopics/tc558">https://www.irs.gov/taxtopics/tc558</a>
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Hey I had to withdraw from my 401k at the end of last year. I did this to help pay for closing costs on a home, can I use this for write off?
No, you cannot write it off. However, there are exceptions if your 401(K) allows hardship distributions. Please read the following TurboTax FAQ. https://ttlc.intuit.com/replies/3302066
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