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First time home buyer

rcooley25
Level 11

My client took and early ditribution from a pension plan to buy his first home. Since the 1099r shows code 1 how do I show it so he does not have the ten percent early withdrwl penalty?

 

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ehammondcpa
Level 3

It goes on Form 5329. There should be a link on the 1099-R input page, but there isn’t. You need to enter it manually on the Form5339 under the first time homebuyer exemption. 

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5 Comments 5
qbteachmt
Level 15

Which type of "pension plan" matters:

https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-tax-on-early-distri...

The person's age matters.

 

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Just-Lisa-Now-
Level 15
Level 15

If it was from an IRA, you can exclude the penalty on the first 10K of the distribution using Form 5329.


♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
ehammondcpa
Level 3

It goes on Form 5329. There should be a link on the 1099-R input page, but there isn’t. You need to enter it manually on the Form5339 under the first time homebuyer exemption. 

rcooley25
Level 11

Thank You > It was a big help.

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qbteachmt
Level 15

I don't see where it was answered which type of plan this is.

401(k) doesn't have this provision; they pay the penalty if they are too young to make that distribution.

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