REVENUE AND TAXATION
63-3022V. deduction for first-time home buyers. (1) As used in this section:
(a) "Account holder" means an individual who resides in Idaho, who has filed an income tax return in Idaho for the most recent taxable year, who is a first-time home buyer, and who establishes, individually or jointly, a first-time home buyer savings account. A married individual living in Idaho who is also a first-time home buyer, filing separately, may be an account holder if the account is established separately from the person’s spouse. Married individuals filing jointly are considered the account holder if they both reside in Idaho, if at least one (1) of them has filed an income tax return in Idaho for the most recent taxable year, and if at least one (1) of them is a first-time home buyer.
(b) "Commission" means the Idaho state tax commission.
(c) "Depository" means a state or national bank, a savings and loan association, a credit union, or a trust company authorized to act as a fiduciary, authorized to do business in Idaho.
(d) (i) "Eligible home costs" means:
1. The down payment for the purchase of a single-family residence in Idaho; or
2. A cost, fee, tax, or payment incurred by, charged to, or assigned to an account holder for the purchase of a single-family residence in Idaho and listed on the statement of receipts and disbursements for the sale, including any statement prescribed by 12 CFR 1026.38, as amended.
(ii) "Eligible home costs" also includes any United States veterans administration funding fee incurred by, charged to, or assigned to a designated beneficiary in connection with a veterans administration home loan guaranty program.
(e) "First-time home buyer" means an individual who resides in Idaho, who has filed an income tax return in Idaho for the most recent taxable year, and who does not own, either individually or jointly, a single-family or multifamily residence and who has never owned or purchased, either individually or jointly, a single-family residence in any location.
(f) "First-time home buyer savings account" means an account established in Idaho with a depository to pay the eligible home costs of the account holder or to reimburse the account holder’s eligible home costs in connection with a qualified home purchase.
(g) "Qualified home purchase" means, with respect to a first-time home buyer savings account, the purchase of a single-family residence in Idaho by the account holder on the date or after the date the account holder opened a first-time home buyer savings account.
(h) "Single-family residence" means a residential dwelling owned and occupied, or under contract to be constructed, by an account holder as the account holder’s principal residence, including but not limited to a manufactured home, mobile home, condominium unit, or townhome.
(2) For taxable years commencing on and after January 1, 2020, annual contributions and interest earned on a first-time home buyer savings account may be deducted from the taxable income of the account holder. Annual deductions shall not exceed fifteen thousand dollars ($15,000) per year for an individual or thirty thousand dollars ($30,000) per year for a married couple filing jointly. Annual contributions to a first-time home buyer savings account shall not exceed the amount deductible under this section. Interest earned on the account shall be tax deferred provided such funds are used for a qualified home purchase subject to this section.
(3) The account holder shall be the beneficiary of the first-time home buyer savings account. The designation shall be made on forms provided by the commission during the year following the date on which the account is established.
(4) No withdrawals may be made from a first-time home buyer savings account within the first thirty (30) days from the establishment of the account. Thereafter, funds held in a first-time home buyer savings account may be withdrawn by the account holder at any time. Deposits into a first-time home buyer savings account shall not exceed one hundred thousand dollars ($100,000) for the lifetime of the account. Withdrawals for the purpose of paying eligible home costs shall not be subject to the tax imposed in this chapter. The burden of proving that a withdrawal from a first-time home buyer savings account was made for an eligible home cost is solely upon the account holder. Other withdrawals shall be subject to the following:
(a) The withdrawal of funds by the account holder for purposes other than the payment of eligible home costs shall be subject to taxes otherwise due.
(b) The direct transfer of funds from a first-time home buyer savings account to another first-time home buyer savings account at a different depository shall not be considered a withdrawal for purposes of this section. Charges relating to the administration and maintenance of the account by the depository are not withdrawals for purposes of this section.
(c) Funds deposited in a first-time home buyer savings account that are deposited in error or unintentionally and that are withdrawn within fifteen (15) days of being deposited shall be treated as if the amounts had not been deposited in the first-time home buyer savings account.
(d) Funds withdrawn from a first-time home buyer savings account that are redeposited into a first-time home buyer savings account within fifteen (15) days of being withdrawn shall be treated as if the amounts had not been withdrawn from the first-time home buyer savings account.
(e) Upon the death of an account holder, the account principal, as well as any interest accumulated thereon, shall be distributed without penalty to a beneficiary or beneficiaries designated by the account holder. Any taxes that are owing on the funds shall be paid by the beneficiary or beneficiaries.
(5) In the case of first-time home buyer savings accounts, account holders shall provide to the state tax commission, in the routine fashion used for all interest-bearing accounts, the same information that is provided for any interest-bearing bank account and shall also include an attestation under the penalty of perjury that the account holder is a first-time home buyer as defined in this section. To minimize the burden of reporting, the information shall be provided in the format in which information is provided for any interest-bearing bank account to the state tax commission. Depositories shall report withdrawals within ninety (90) days on a form provided by the commission. Account holders shall provide on any state income tax form in which they take a deduction for a first-time home buyer savings account the account number of their first-time home buyer savings account and the depository at which the account is held.
(6) First-time home buyer savings accounts shall be nontransferable to any person who is not the account holder.
(7) The commission shall promulgate rules to administer the provisions of this section.
[63-3022V, added 2020, ch. 252, sec. 1, p. 736.]