topic Mutual funds in Investors & landlords

Mutual funds

lewjaz1 — Mon, 09 Mar 2026 05:35:21 GMT

I used money from a mutual fund to purchase a home. The entire amount withdrawn was used for the purchase. Is this taxable, and how? It is appearing as ordinary income.

Re: Mutual funds

DoninGA — Sat, 19 Feb 2022 17:41:43 GMT

Yes, the amount distributed is entered as ordinary income and taxed at your current tax rate.

There is an exception to the 10% early distribution penalty if the funds were withdrawn from an IRA and used for the purchase of a first home. But only the amount up to $10,000 is eligible for the exclusion. The distribution is still a taxable event and reported on a tax return as ordinary income.

Re: Mutual funds

Bsch4477 — Sat, 19 Feb 2022 17:44:27 GMT

Was the fund in a retirement account? If so, it is taxed as ordinary income. If from an IRA you can be exempt from the early withdrawal penalty, however.