Can I use my SEP IRA to buy a house?
July 14, 2003
Subject: SEP-IRA Early Withdrawl
Date: Wed, 18 Jun 2003
The company that I am currently working for puts money into a SEP-IRA account for all of its employees. My question is, can I take some of the money out without the penalties? I am currently trying to purchase my first home and need some help on the down payment. I live and work in California. Any and all help would be greatly appreciated!
Date: Mon, 7 Jul 2003
There is an exception to early withdrawal penalties for distributions from an IRA to buy a principal residence. Only $10,000 may be withdrawn for this purpose during an individual's lifetime. To qualify, the taxpayer must be considered a "first-time homebuyer." To be a first time homebuyer, the individual (and spouse, if married) must not have had an ownership interest in a principal residence during the two-year period ending on the date that the new home is acquired.
The exception is reported at line 2, Part I of Form 5329.
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