IRA early withdrawal penalty exception for 1st time homebuyer
I have 2 brothers (both in their 30’s) that EACH want to use the 1st time home buyer penalty exception to buy a duplex. They would each withdraw $10K from their respective IRAs to buy the duplex and live separately in both sides of the duplex as their primary homes. So there would be no rental income from one side of the duplex.
My reading of IRS Pub 590-B doesn’t define a “home” for the purpose of an early IRA withdrawal penalty exception as a single family home, duplex, etc.
Does a duplex that would be used as a primary home for both of these first time homebuyers qualify for the penalty exception?
Permalink Submitted by Alan - IRA critic on Mon, 2019-03-11 16:58
The duplex would qualify as a principal residence, but of course the taxpayer much meet all the other requirements of a first time homebuyer. Even the purchase of stock as a tenant stockholder would qualify for the occupied unit.
Permalink Submitted by Brad King on Mon, 2019-03-11 21:10
Thank you for clearing this up!