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H 1489

An Act creating the tenant’s escrow accounts

194th Legislature (2025-2026) Introduced by David DeCoste and 1 co-sponsor

Creates a Tenant’s Escrow Accounts program where tenants can voluntarily channel rent into escrow for a future home down payment, with a Commonwealth match and landlord tax incenti

Accompanied a study order, see H5352 (under House Rule 27)
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Bill Summary · H 1489

Summary: H.1489 – An Act Creating the Tenant’s Escrow Accounts

Overview

H.1489, introduced February 27, 2025, would establish a Tenant’s Escrow Accounts program managed by the Massachusetts Executive Office of Housing and Livable Communities (EOHLC). The program aims to help rental tenants save toward purchasing a home by allowing voluntary rent-derived contributions to be deposited into individual tenant escrow accounts, with a government match and certain tax incentives for contributing landlords.

  • Status: Hearing scheduled for November 19, 2025, 11:00 AM–5:00 PM, Gardner Auditorium.
  • Origin: Referred to the House Committee on Housing (same-day Senate concurrence noted); House Docket No. 1489; Filed January 14, 2025.
  • Primary sponsor: Representative David F. DeCoste (Norwell).

Purpose and Intent

  • Create a savings mechanism that enables tenants to accumulate funds for a down payment on a home.
  • Provide a framework for voluntary tenant contributions to escrow accounts, with protections on how funds can be used (solely for down payment purposes).

Key Provisions

Section 1 – Establishment and Operation

  • The EOHLC shall develop a savings program called the “tenant’s escrow accounts.”
  • Tenants may voluntarily contribute a portion of their rent into an escrow account.
  • Withdrawals from the escrow account are restricted to use toward the down payment on the tenant’s home.

Section 2 – Commonwealth Match

  • Landlords’ contributions to tenants’ escrow accounts are to be matched by the Commonwealth.

Section 3 – Tax Benefit for Landlords

  • Landlords who contribute to a tenant’s escrow account may deduct an amount equal to three times their contributed amount from their net annual taxable income payable to the Commonwealth.

Section 4 – Dedicated Fund

  • A separate fund, the Tenant’s Escrow Fund, will be established on the Commonwealth’s books.
  • Landlord contributions and Commonwealth matches are credited to this Fund.
  • The Fund is not subject to Section 5C of Chapter 29 of the General Laws.

Section 5 – Regulations and Eligibility

  • The EOHLC will promulgate regulations implementing the act.
  • Provisions may allow:
    • Contributions restricted to a specific tenant (targeted) or
    • General contributions available to eligible tenants (as determined by the EOHLC).
  • The secretary must submit proposed regulations to the Joint Committee on Housing and the House and Senate Ways and Means Committees at least 30 days before adoption.

Who Is Affected

  • Tenants/Renters: Potential custodians of escrow accounts funded by voluntary rent contributions toward down payments.
  • Landlords: Potential contributors eligible for a tax deduction (three times the contributed amount); involvement in escrow program.
  • Commonwealth: Provides matching funds and administers the Tenant’s Escrow Fund; enacts regulations.
  • EOHLC: Responsible for program development, administration, and rulemaking.

Procedural and Timeline Aspects

  • Introduced / Filed: February 27, 2025 (House No. 1489).
  • Committee Action: Referred to the Committee on Housing (2025-02-27).
  • Legislative Actions: Senate concurrence noted; related docket HD 1433 (replaces).
  • Hearing: Scheduled for November 19, 2025, Gardner Auditorium (11:00 AM–5:00 PM).

Potential Impacts and Considerations

  • Could advance tenant homeownership by enabling systematic savings tied to rent payments.
  • Creates a public-private-savings framework with a government match and landlord tax incentives.
  • Financial and administrative implications for the Commonwealth, including funding levels for matches and regulatory costs.
  • Requires careful implementation to ensure clarity around eligibility, fund management, and safeguards for tenant funds.

Related Information

  • Related bill: HD 1433 (replaces) discussed in connection with this measure.

Compiled from official sources — confirm details with the bill’s official record.

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