Early distribution exception

[Possi]

The early distribution exception from a retirement account says "early distribution from IRA" for $10.000 to first time home buyer.

My client's distribution is from a 401K.

She is out of luck, isn't she? I'm trying so hard to save her money!

[KBTS]

Yes, that exception is just for IRA distributions. Does she qualify for the first time homebuyer credit? In the latest deal on the stimulus package, the repayment requirement for this credit is eliminated.

[Possi]

Yes

Yes she does qualify for first time home buyers credit.

It will make me ill if they don't make the people pay that back. My daughter and bazillions of other people bought houses last year before April, and didn't get a free handout from the government aka WE TAXPAYERS.

But that's just my ranting.....

It's not decided yet that they won't have to pay it back, right?



Thanks for the reply

[KBTS]

I just read earlier at the WSJ website that the House and Senate reached a deal on the different versions of the plan. They agreed to eliminate the repayment provision. Looks like they will vote later this week on the final version of the bill.