Bill > S2089

This bill establishes a new tax-advantaged savings account program specifically designed to help first-time home buyers in Massachusetts save for purchasing a single-family residence. The bill defines key terms such as "first-time home buyer" (someone who hasn't owned a home in the past three years) and "first-time home buyer savings account" (a specially designated account for saving towards home purchase expenses). Account holders can contribute cash and marketable securities to these accounts, with annual tax deductions of up to $5,000 for individual filers or $10,000 for joint filers, and can also deduct earnings from the account. The account can be used to pay for eligible costs like down payments and closing costs for a Massachusetts single-family residence, which includes various housing types like condominiums and manufactured homes. Accounts have a 15-year maximum duration with a total deduction limit of $50,000, and if funds are withdrawn for non-eligible purposes, they become taxable income with potential penalties. The bill also provides flexibility in account ownership, allowing individuals to have multiple accounts and change designated beneficiaries, while placing minimal administrative burdens on financial institutions. The goal is to help make homeownership more accessible by providing tax incentives for saving towards a home purchase.

Budget and Finance

https://malegislature.gov/Bills/194/S2089