First-Time Homebuyer Savings Account Act Is Now Law

Today, Governor Mike Parson signed House Bill 1796 which allows the creation of a special savings account intended to better prepare first-time homebuyers.  It will go into effect on January 1, 2019.

This bill allows taxpayers in Missouri to deduct 50 percent of their contributions to a first-time homebuyer savings account.  For single filers, the limit is $800. It’s $1,600 for married filers. Furthermore, any interest accrued within that savings account will be tax free so long as the money is all spent on the purchase of a home. Those eligible purchases include a down payment, closing costs, appraisal fees and mortgage origination fees among others.

People that are eligible for this tax deduction must either be first-time homebuyers or must have not held a deed in their name for 3 consecutive years, following a divorce.

Senate Bill 581, which makes changes to landlord and tenant law, was also signed by the governor. This bill “repeals provisions requiring a landlord to keep security deposits in a trust and authorizes the right to a trial de novo in rent and possession actions.”