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Level 1
posted Jan 27, 2020 7:33:08 PM

1009-R Box 7 question

I took money out from 401k to purchase my primary home, the code in box 7 have '1', is this should be '2'?

0 2 603
2 Replies
Expert Alumni
Jan 27, 2020 7:53:08 PM

It should be a code 2. Contact the issuer and ask for a corrected form.

Level 15
Jan 28, 2020 5:37:24 AM

Unless you were age 55 or over in the year you separated from service from the company providing the 401(k), Code 1 is correct.  Using a distributions from a 401(k) to buy a home does not qualify as an exception to the early-distribution penalty.  That exception is only available for a distribution from an IRA for the purchase of a first home, not for a distribution from a 401(k).