I want to purchase a home and want to cash out my 401k. I am currently 61 and would like to know what taxes penalties I would incur?

This is not a good idea, unless you are retiring. If you are working, then the full amount of the distribution will be taxed according to your current tax rate. Plus you would still be subject to the 10% penalty for in service withdrawal. So you could lose 30-40% of the amount you withdraw.

Actually, because of his age (61), there will be NO 10% penalty, but the distribution WILL be taxed at normal tax rates.

Whoops sorry. They keep moving retirement ages on me. Yes the penalty goes away at 59 and 1/2.

As ATE says - regular income taxes (federal + state/local if applicable where you live) would be due, but no penalty would be owed as you are over 59-1/2 years of age. However, if you are still working you may find that your company's plan has restrictions on active employees taking distributions. It may be a better option for your to borrow the amount you need for the down payment from your 40q1(k) account - that way you stay active in the plan and are paying interest to yourself. This option is available only if you are an active employee.