Nassau Posted February 22, 2012 Posted February 22, 2012 This question is related to Hardship Withdrawals (purchase of a principal residence). The client has a participant who currently owns a home with his ex-wife. The existing mortage is in both of their names. The participant is still living in this residence, and he would like to buy his wife out of the house. An agreement of sale and other necessary legal documentation would be provided. The question is though, since he is technically purchasing the house (I believe a new mortgage will be done in just his name) and he will continue to live in it, would that be considered the purchase of a primary residence, or since he already owns a portion of the house, is it not considered a new purchase?
QDROphile Posted February 22, 2012 Posted February 22, 2012 In informal Q&As at the ABA tax section meeting some years ago, the IRS said that purchasing a co-owner's undivided interest in a residence qualifies. Maybe the question related to exceeding the five year limit on plan loans. I think the Q&As can be still be found on the ABA website at http://www.americanbar.org/groups/committe...e_benefits.html Edit: The url posted above looks funny. I copied and pasted, but is suspect that the three dots should be deleted.
Nassau Posted February 22, 2012 Author Posted February 22, 2012 In informal Q&As at the ABA tax section meeting some years ago, the IRS said that purchasing a co-owner's undivided interest in a residence qualifies. Maybe the question related to exceeding the five year limit on plan loans. I think the Q&As can be still be found on the ABA website at http://www.americanbar.org/groups/committe...efits.htmlEdit: The url posted above looks funny. I did not find the Q&As at the ABA tax section meeting. Can you send it to me. Thanks.
masteff Posted February 22, 2012 Posted February 22, 2012 Took me several minutes of googling... Found this thread: http://benefitslink.com/boards/index.php?showtopic=35213 Which lead me to find this document, see Q-19: http://www.americanbar.org/content/dam/aba...uthcheckdam.pdf Kurt Vonnegut: 'To be is to do'-Socrates 'To do is to be'-Jean-Paul Sartre 'Do be do be do'-Frank Sinatra
Nassau Posted February 22, 2012 Author Posted February 22, 2012 Thank you very much!!!!!!!!!! Took me several minutes of googling... Found this thread: http://benefitslink.com/boards/index.php?showtopic=35213 Which lead me to find this document, see Q-19: http://www.americanbar.org/content/dam/aba...uthcheckdam.pdf
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