If my wife and I both withdrew from 401k to purchase a house can we claim 10k each without early withdrawal penalty or is it 10k max per couple? If so how can we do so?

[xmasbaby0 · Accepted solution]

Taking money from your 401k to purchase a house is not an exception to the 10% early withdrawal penalty. That is only with a traditional IRA. You will face the early withdrawal penalty and ordinary income tax on the amount you took out of a 401k. You will each receive a 1099R for the distributions, which must be entered on your tax return.