If you're a first-time homebuyer (a status defined more flexibly than you may think), you can tap your IRA to help with the costs of your pu
If you qualify as a first-time homebuyer, you can withdraw up to $10,000 from your traditional IRA and use the money to buy, build, or rebuild a home. With a Roth IRA, you can withdraw your contributions tax and penalty-free at any time, for any reason, as long as you have held the account for at least five years.
This doesn't mean using your IRA to buy a home is a good idea, though. By withdrawing money from your IRA you will lose out on years of compound interest, and the contribution limits for IRAs make it difficult to rebuild these accounts. If you need to tap an IRA to fund your home purchase because you have no other options, reconsider the timing of your home purchase. It probably makes better financial sense to wait until you’ve saved the down payment while leaving your retirement savings intact.