The proposed bill introduces the "First Time Home Buyer Savings Account Act" to the Code of West Virginia, establishing a framework for first-time home buyers to create savings accounts specifically for the purpose of covering down payments and closing costs associated with purchasing a single-family residence. The bill outlines definitions for key terms such as "account holder," "eligible costs," and "financial institution," and specifies the conditions under which individuals can create these accounts, including contribution limits and joint ownership provisions. Additionally, it allows for subtractions from federal adjusted gross income based on contributions to these accounts, with specific limits based on the taxpayer's income level.

Furthermore, the bill sets forth penalties for withdrawing funds from the savings account for non-eligible expenses, requiring that such withdrawals be included in taxable income and subject to a 10% penalty. Financial institutions are mandated to provide account holders with annual information certificates detailing account activity, while the Tax Commissioner is tasked with proposing rules for the implementation of the act. The provisions of this act will apply to tax years beginning on or after January 1, 2025, and before January 1, 2031, with certain exemptions for funds contributed before January 1, 2029.

Statutes affected:
Introduced Version: 31-18G-1, 31-18G-2, 31-18G-3, 31-18G-4, 31-18G-5, 31-18G-6, 31-18G-7, 31-18G-8, 31-18G-9, 31-18G-10