When I finally receive my portion of my ex husband's 401k- I'm wondering if I withdraw the money to use as a down payment on a house for my children and I-what is the penalty? I've heard that there is not a penalty for that purpose. If there is, how much is the penalty??

IF you got the withdrawal as a result of a divorce (I suspect as much since he is your "ex"-husband), there IS no penalty for the withdrawal. However, your tax pro will need to know ALL of the specific so he can request an exception on your 2007 tax return.

Further, you may not even have to pay the normal income tax. It depends on HOW the withdrawal was handled. If it was withdrawn under your husband's name, then HE is on the hook to pay the taxes. This happened in the 2005 tax season to a client who got divorced.

I took a withdrewl to buy a summer home in FL of 50.000.

I took a withdrewl from by 401 to buy a house

Hello Less Tax. Please do not tack a new question onto an old thread like this. You should start your own new question. But before you do that - please be sure to pose it in the form of a question - what specifically do you want to know about taking a withdrawal for a summer home?