Bill > H2840

This bill establishes a first-time homebuyer savings account program in Massachusetts. The key provisions are: 1. Individuals can open a designated first-time homebuyer savings account with a financial institution and make contributions to the account, which can be used to pay for the down payment and closing costs when the account holder or a designated qualified beneficiary (a first-time homebuyer) purchases a single-family residence in Massachusetts. 2. Account holders can deduct up to $5,000 (individual) or $10,000 (joint) per year from their taxable income for contributions made to the account, as well as any earnings on the account. The total deduction is capped at $50,000 over 15 years. 3. If the funds are withdrawn for purposes other than eligible homebuying costs, they will be subject to income tax and a penalty, with some exceptions (e.g., account holder's death or disability, bankruptcy). 4. Financial institutions are not required to designate accounts as first-time homebuyer savings accounts or track the use of the funds, but account holders must report the account details to the Massachusetts Department of Revenue. The goal of the bill is to encourage and assist first-time homebuyers in Massachusetts by providing tax incentives for saving towards the purchase of a home.

Budget and Finance

https://malegislature.gov/Bills/192/H2840