Is early distribution from ESOP subject to the 10% penalty when used for down payment on first home? If so how do you enter into Turbo Tax?

[downundergeorgia]

Fully explained above.

[macuser_22]

How is the distribution reported to you - what form?

[downundergeorgia]

Forms 1099-R and 1099-B

[macuser_22]

What code is in box 7 on the 1099-R?
What is in box 2a?
Is the IRA box checked?
Did you roll it into an IRA?

[downundergeorgia]

Code in box 7 on 1099 - R is 1
Box 2a 7,268.87
No IRA Box was not Checked
No  Did not roll into IRA
Used funds for purchase of first home

[macuser_22 · Accepted solution]

The first home exemption only applies to IRA's.  You could have rolled the ESOP into a Traditional IRA and then used a Traditional IRA distribution for the first home.

[downundergeorgia]

I guess its to late to do that now?

[macuser_22]

A rollover must be completed within 60 days of the distribution date of the ESOP.

[downundergeorgia]

Thank you for your help