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Took a withdrawal out of 401(k) Plan Distributions and Used for first Home Purchases in Qualified Disaster Areas

I used a majority of the withdrawal to purchase my first home between December 27, 2020, until June 25, 2021. How do I input this to reduce the 10% early withdrawal? 

 

https://complianceadministrators.com/coronavirus-covid-19-regulations-401k-plan-considerations/

https://wilkecpa.com/qualified-disaster-related-distributions-from-retirement-plans/

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2 Replies
MaryK4
Expert Alumni

Took a withdrawal out of 401(k) Plan Distributions and Used for first Home Purchases in Qualified Disaster Areas

Unfortunately, you are able to withdraw from your 401(k) because of the "hardship" provision in order to purchase a new home, but there is no such allowance to avoid the 10% penalty.  The links you have refer to the repayment of the 401(k) used for a home purchase and repaid before June 25, 2021.  

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Hal_Al
Level 15

Took a withdrawal out of 401(k) Plan Distributions and Used for first Home Purchases in Qualified Disaster Areas

The home buyer penalty exception is only for IRA withdrawals, not 401k.

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