Warning — inconsistent source materials
- The title and some metadata you supplied describe a bill about juvenile records and firearm licensing. The full bill text you attached, however, is a Massachusetts Senate bill (S. 2089) to create “First‑Time Home Buyer Savings Accounts.” This summary treats the actual bill text you provided (first‑time home buyer savings accounts). If you intended the juvenile‑records/firearm bill instead, please provide the correct text or confirm.
Summary: “First‑Time Home Buyer Savings Accounts” (MA S.2089, 1/17/2025)
Purpose
- Establish tax‑favored savings accounts to help Massachusetts residents save for a down payment and allowable closing costs when purchasing a single‑family residence as a first‑time homebuyer.
Key provisions
- Definitions: establishes terms including Account holder, First‑Time Home Buyer (no ownership of a single‑family residence in prior 3 years), Eligible costs (down payment + allowable closing costs), Qualified Beneficiary, First‑Time Home Buyer Savings Account, Settlement Statement, Single‑Family Residence (includes condos, manufactured homes, cooperatives).
- Account creation and designation:
- Individuals may open an account with a Massachusetts financial institution and designate it as a First‑Time Home Buyer Savings Account beginning Jan 1, 2024.
- The account holder must designate a Qualified Beneficiary no later than April 15 following the tax year in which the account was established. The account holder may be the beneficiary and may change the beneficiary (but only one beneficiary at a time).
- Joint accounts allowed if joint filers file joint Massachusetts returns.
- One person may hold multiple accounts, but cannot have multiple accounts naming the same beneficiary; a beneficiary may be named on multiple accounts.
- Contributions and permitted assets:
- Only cash and marketable securities may be contributed. Others may contribute to an account.
- No overall cap on contributions or account balance.
- Financial institutions may deduct service fees from accounts; other administrative expenses may not be paid from account funds.
- Tax treatment:
- Account holders may deduct contributions from Massachusetts taxable income, subject to limits: up to $5,000 per year for individual filers and $10,000 per year for joint filers (text truncated beyond this point).
- Compliance and reporting:
- Account holders must submit to the Department of Revenue (DOR) account details: transaction list for the tax year, the Form 1099 issued by the financial institution, and if withdrawals occurred, documentation of eligible costs applied and remaining balances.
- Financial institutions are explicitly not required to designate accounts as first‑time home buyer accounts in their systems, track use of withdrawn funds, allocate funds among joint holders, or report beyond existing legal requirements. Financial institutions are not liable for ensuring account compliance or for tax reporting/penalties related to account misuse.
Who is affected
- Prospective first‑time homebuyers in Massachusetts (as defined).
- Account holders and contributors (including family members who may contribute).
- Financial institutions offering deposit/ brokerage accounts in Massachusetts (limited new obligations).
- Massachusetts Department of Revenue (will receive taxpayer disclosures and may monitor compliance).
- State tax revenues (will be affected by deductions; fiscal impact not estimated in the text provided).
Procedural status and notes
- Bill text filed 1/17/2025 in the Massachusetts Senate (presented by Bruce E. Tarr).
- Provided legislative action entries are inconsistent (multiple committee referrals, hearing dates, and other items). The bill text appears complete for many key provisions, but the copy you provided is truncated in the tax‑treatment section; additional sections (e.g., penalties, rollover rules, coordination with federal law, or sunset provisions) may exist in the full bill.
- If you want: I can (a) reconcile the conflicting metadata, (b) extract a fiscal/estimate of revenue impact (requires legislative fiscal notes or assumptions), or (c) produce language comparisons to prior or related proposals.
