To amend the Internal Revenue Code of 1986 to allow tax-free withdrawals from individual retirement accounts for use in purchasing a first home.

Amends the Internal Revenue Code to exclude from the gross income of a first-time homebuyer the amount of any individual retirement plan distributions used within a reasonable period to purchase, construct, or reconstruct a principal residence. Limits such distribution to the excess of $15,000 over the aggregated amount so treated for all prior taxable years. Excludes such distributions from the penalty for early withdrawals from retirement plans.