SB 339

This bill creates a tax-advantaged first-time home buyers savings account.

Under the bill, an individual may create the account and must designate a

beneficiary of the account, which may be the account holder. The beneficiary must

be an individual who is a first-time home buyer, which is defined as someone who

resides in this state and has not owned or purchased a single-family residence

during the 36 months before the month in which the individual purchases the

residence in this state. An account holder may withdraw funds from the account to

pay the down payment and eligible closing costs for the purchase of a single-family

residence in this state by the beneficiary or to reimburse the beneficiary for eligible

costs. The account holder may not use funds from the account to pay any expenses

he or she incurs in administering the account, although the financial institution may

deduct a service fee from the account.

Beginning in taxable year 2020, annually, an account holder may subtract from

his or her federal adjusted gross income (FAGI) up to $5,000, or $10,000 if the account

holder files a joint income tax return, of the amount he or she contributes to an

account, as well as any gain that is redeposited into the account. An account holder

may not claim a subtraction for more than a total of $50,000 of deposits into an

account for each beneficiary.

Because this bill relates to an exemption from state or local taxes, it may be

referred to the Joint Survey Committee on Tax Exemptions for a report to be printed

as an appendix to the bill.