Early Withdrawal

Question: Buying a second home with IRA account funds?

People told me IRs Code 408 allows the purchase of sedcond home with IRA account funds. I have a few questions.
1) Is money taxable when you withdraw it to make the down payment?
2) Can you live in the second home or do you have to rent it out as a source of income for your IRA account?
3) Does the person inherit this second home enjoy the stepup value at the time of title transfer?
Thank for all the help I can get.

Answer: I know you can use those funds to buy a FIRST house, but nowhere have I seen the tax code benefit for second homes. First time homebuyers get breaks like that, not the people who buy multiple homes.

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