The Homeownership Savings Act would create tax-advantaged savings accounts for eligible first-time homebuyers age 18 or older. Account contributions could be deducted from taxable income, subject to limits based on filing status, earned income, and income. Annual deduction limits are $3,000 for joint filers, $2,500 for heads of household, and $2,000 for other individuals, with reductions at higher incomes. Total contributions are capped at $40,000. Withdrawals used for a qualifying first home’s down payment or closing costs would not be included in taxable income. Other withdrawals would generally be taxable and subject to an additional 20% tax, with exceptions for death or disability. The bill would apply to tax years beginning after December 31, 2026.
If you meet the bill’s first-time homebuyer rules, you could open an account and may be able to deduct qualifying contributions. You would need to certify that you are a first-time homebuyer when the account is opened. The bill also allows certain employer contributions to be excluded from income, within the lifetime contribution limit. The bill was referred to the House Committee on Ways and Means.
No publicly available information on the bill’s federal budgetary cost. Individuals could contribute up to $40,000 over the account’s lifetime, subject to the bill’s rules.
No publicly available information.
No publicly available information.