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Author: saba74 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 76418  
Subject: Buying a home/saving money Date: 12/1/1999 5:38 PM
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My wife and I are looking to buy a home within the next 6-8 months. We have a large sum of money saved and want to protect it from the "taxman". We have already purchase our first house abour 4 years ago. We have moved from that home and have been renting since. We no longer own the home. We were looking into a ROTH IRA to save our money and not get penalized for taking it out, but the "rules" for the IRA state for first time home buyers. Can anyone please help us. Is the ROTH a good choice or is there another IRA or fund to put our money in?

Thanks

saba74
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Author: TMFPixy Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 15821 of 76418
Subject: Re: Buying a home/saving money Date: 12/2/1999 9:16 AM
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Greetings, Saba74, and welcome. You wrote:

<<My wife and I are looking to buy a home within the next 6-8 months. We have a large sum of money saved and want to protect it from the "taxman". We have already purchase our first house abour 4 years ago. We have moved from that home and have been renting since. We no longer own the home. We were looking into a ROTH IRA to save our money and not get penalized for taking it out, but the "rules" for the IRA state for first time home buyers. Can anyone please help us. Is the ROTH a good choice or is there another IRA or fund to put our money in?>>

You may withdraw your annual contributions from a Roth IRA at any time without taxes or penalty. Therefore, if you put in $2K per year for three years and then withdraw $6K, that is allowed. You just can't touch the earnings unless you use one of the authorized exceptions for doing so.

BTW, under the exception for a "first-time" home purchase, "first-time" really means you can't have owned a home in the two years preceeding the purchase of a new home. If you haven't owned a home for more than two years at the time of purchase, then you qualify as a first-time purchaser for the early withdrawal exception.

Regards..Pixy

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