As I understand it, I can withdraw up to $10,000 from my IRA for a first home purchase with no tax penalty.
Suppose I choose not to do so, and then 3 or 4 months from now (during the same tax year), my checking account is quite depleted and I think “man, I could sure use $10,000 to help pay the mortgage”. At that point, can I withdraw that $10,000 and still get no tax penalty?
(Assume that the down payment is FAR more than $10,000)
Thanks
You do know you still have to pay income tax on it, right? You just don’t get charged the additional 10% penalty that is normally assessed on early distributions.
I thought that the check has to be made out to the lender, but I’m not positive about that.
It looks like you might be able to still take it after the fact:
“Fourth, as of 1998, you can take a penalty-free withdrawal of up to $10,000 from any type of IRA to purchase a first home for yourself, your spouse, your child or spouse’s child, your grandchild or spouse’s grandchild, your parent or other ancestor, or your spouse’s parent or other ancestor. A “first home” actually means the person’s first home within the last two years.”
http://taxguide.completetax.com/text/c60s10d597.asp
As stated above, you still have to pay taxes on it. You just don’t pay the 10% penalty.