The bill introduces the "First Time Home Buyer Savings Program Act" as a new chapter in Title 34 of the General Laws, aimed at assisting individuals in saving for their first home purchase. It establishes a savings account fund where participants can deposit up to $50,000, with the ability to subtract this amount from their federal adjusted gross income. Additionally, participants can subtract up to $150,000 of interest and dividend income. The state investment commission is responsible for investing the funds, and withdrawals are permitted for the qualified purchase of a first home. However, withdrawals for other purposes will result in the loss of tax benefits. The bill also amends Section 44-30-12 of the General Laws, affecting personal income tax deductions and adjustments for Rhode Island residents.

The bill proposes changes to state income tax deductions, including a cap on the amount subtracted for contributions to a tuition savings program and modifications for taxable Social Security income for those below certain income thresholds. It also adjusts the exclusion of taxable pension and annuity income for eligible individuals, with an increase to $20,000 for tax years beginning on or after January 1, 2023, and includes provisions for the exclusion of military service pension benefits. The First Time Home Buyer Savings Act allows for additional tax deductions related to contributions and interest/dividends for participants. The act takes effect upon passage and aims to provide financial assistance to first-time homebuyers through the established savings program fund.

Statutes affected:
2556: 44-30-12