I withdrew 4k from a traditional and roth for a home purchase 30 days ago and ended up buying a cheaper home. I want to know if I can put the money back into the IRAs.

[fanfare]

"If you received a distribution to buy, build, or rebuild
a first home and the purchase or construction
was canceled or delayed, you generally can
contribute the amount of the distribution to an IRA within
120 days of the distribution. This contribution is treated as
a rollover contribution to the IRA."

It's your call to claim your purchase was cancelled because you found something cheaper.
You can do a Rollover without having any earned income.
It sounds like you may need to open another IRA to do this. that's what I would do.

Later on you can recombine the IRAs if desired.

[tyle50-]

You should be able to reverse both withdraws but it might depend on the financial instituition if they can handle your request.  everyone has different rules.

[Anita01]

Yes, you can put the money back in within 60 days to avoid any tax or penalty.  If tax was withheld when you took the money out, you would have to replace that amount in addition, in order to avoid tax on it.

[r-antonio-alvara]

thanks. it was 2 separate accounts. i read that the 60 day roll-over can only be once per year. can i say that the purchase of the original home fell through (put money back within 120 days) and the cheaper home is what caused the lack of need for the ira money? not sure how the software/form would handle the fact that i did purchase a home within 120 days, just not the house i thought i was buying. thanks.

[r-antonio-alvara]

thanks. it was 2 separate accounts. i read that the 60 day roll-over can only be once per year. can i say that the purchase of the original home fell through (put money back within 120 days) and the cheaper home is what caused the lack of need for the ira money? not sure how the software/form would handle the fact that i did purchase a home within 120 days, just not the house i thought i was buying. thanks.

[Anita01]

If you did not roll the money over within 60 days, then it does not qualify as a rollover and, if you did indeed redeposit any of the money, it would be considered an excess contribution, subject to a penalty.  The penalty will calculate every year until you remove the excess contribution.
You seem to be mixing up two different things..  A rollover must be done within 60 days of the withdrawal.

If you are now talking about a withdrawal having no penalty charge for early distribution if used to purchase a first home, it makes no difference at all what house you buy, but it only applies to $10,000 of your withdrawal and has nothing to do with the rollover rules.  You can rollover money from EACH IRA account once a year but it still has to be done within 50 days,

[r-antonio-alvara]

I'll be specific and hopefully you can help me. I took out 1000 from my Traditional IRA - sent money to my checking account to fund the closing/down payment of a home purchase. I transferred 2500 and 1500, due to settlement of 2 separate trades, from a roth IRA to the same checking account for the same purpose of funding the closing/down payment. I ended up not needed the money because the home i ended up closing on required less money. I want to know if i will be able to wire the money back to the respective iras, without a penalty, and they will both be done within 45 days. thanks!

[Anita01]

Never mind, I just saw you only took out $4,000 so you would not have an excess contribution assuming you had at least $4,000 in earned income

[Anita01]

Yes, you can redeposit as much of that as you want with a penalty as long as it occurs within 60 days.