We took out money from 401k to put a down payment on a land contract how will i use that as home buying or other
There is not a 10% early withdrawal penalty exception for funds withdrawn from a 401k on the purchase of a home for a first time homebuyer. That exception to the penalty is only if the funds were withdrawn from an IRA and then only the first $10,000 is eligible.
The withdrawal is entered on your tax return as ordinary income and taxed at your current tax rate. Any taxes withheld from the withdrawal will be entered on your tax return as a tax payment (just like from a W-2). The 10% early withdrawal penalty (if any) will be assessed on your tax return as a tax liability.
You will receive a Form 1099-R for the withdrawal in January or early February, if not already received.
To enter a form 1099-R -
Click on Federal Taxes (Personal using Home and Business)
Click on Wages and Income (Personal Income using Home and Business)
Click on I'll choose what I work on (if shown)
Scroll down to Retirement Plans and Social Security
On IRA, 401(k), Pension Plan Withdrawals (1099-R), click the start or update button
Or enter 1099 r in the Search box located in the upper right of the program screen. Click on Jump to 1099 r