It’s only $3600 or so, but I don’t know how I put this onto my taxes when I go to file next yr.
I just got a check from my bank- how do I “prove” to the IRS that I used it toward qualifying costs and such?
Thanks! I need to remember that 5329 form because the penalty should indeed be waived! Thanks!
Am I able to use the 5329 form through like, turbotax or one of those online filing programs or do I have to go see someone?
Thanks- as for 2009 taxes having bought a home, that sounds confusing and we may have to go see a tax professional.
Fiance already checked with the tax website and you can amend the 2008 return right there.
Not married and won’t be until the fall of next year.
Took disbursement from Trad. IRA for closing costs/downpmt. How to I add this to my 2009 taxes at tax time?
04
Apr
Wayne Z
April 4, 2010 at 7:50 pm
There is a line for IRA distributions on the 1040 and the 1040A.
If this was for your first home (you hadn’t owned a home for two years prior to closing on this one), you can eliminate the penalty using Form 5329.
knowitall
April 4, 2010 at 7:56 pm
When TT asks if you purchased a home this year and you answer yes, it will probably bring up a 5329 automatically after more questions.
Mathew
April 4, 2010 at 8:51 pm
Assuming that you are a qualified first time home buyer you will have the following entries on part 1 of form 5329; Line 1: $3,600 Line 2: $3,600
Line 3: 0 and exception 09 Line 4: 0 That will take care of the early distribution penalty. On your 1040 form you have the following entries; Line 15a: $3,600 and Line 15b: $3,600 That will include the $3,600 in your ordinary income and you will be subject to the ordinary rate based on your tax bracket. You should be able to do all of this on turbo tax.
If you are closing on the home prior to 12/01/2009 you should also be qualified for the First Time Home Buyers Credit (FTHBC). You can amend your 2008 return with a 1040X and form 5405 to get the FTHBC of $8,000. Also include your HUD-1 closing documents and Trust deed if have one. You do have the option of doing that on your 2009 return. I don’t know if you can do that on turbo tax or not as the form 5405 changed after the 2008 turbo tax was issued. I would think they would have some means of updating to accommodate the change.n
v b
April 4, 2010 at 9:41 pm
For 2009, before you waste your money:
If you are married, your standard deduction will be $11,400. You can only itemize if the total on schedule A is more than that. Many people cannot itemize the first year.
Schedule A includes mortgage interest, points, state and local income taxes, property taxes after you bought the house and charitable contributions. Even if you don’t itemize, you may be able to add some of the property taxes to the standard deduction on the 1040 (the government is eroding the standard deduction).
The amount *over* $11,400 is then reducing your income by the tax rate. Go $100 over, you save $15.
Which if your preparer charges $100 extra to do a 1040 isn’t saving you any money.