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bbprince123
New Member

I received my 1099-r and the distribution code 1 but i withdrew money from my 401 k for my down payment and closing cost on my home in 2016 . Is this right ?

 
1 Reply
jerry2000
Alumni

I received my 1099-r and the distribution code 1 but i withdrew money from my 401 k for my down payment and closing cost on my home in 2016 . Is this right ?

A distribution code of 1 means early withdrawal, no penalty exception.
Using 401k money to buy a home is not an exception to the penalty for early withdrawal, and the distribution is fully taxable as ordinary income.
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