Source: United States House of Representatives – Julia Brownley (D-CA)
Washington, DC – Today, Congresswoman Julia Brownley (CA-26) and Congresswoman Beth Van Duyne (TX-24) announced the introduction of the Uplifting First-Time Homebuyers Act (H.R. 3526), bipartisan legislation that would increase the Internal Revenue Service (IRS) qualified distribution limit for first-time homebuyers utilizing Individual Retirement Account (IRA) funds. The introduction of this legislation coincides with National Homeownership Month and highlights the importance of homeownership in building strong communities and generational wealth.
In 1997, Congress created a tax provision allowing first-time homebuyers to withdraw up to $10,000 from their IRAs without incurring the standard 10% early withdrawal penalty. At the time, the median home price was $115,000. Today, the median price has nearly tripled, yet the $10,000 cap has not been updated. The Uplifting First-Time Homebuyers Act would raise the qualified distribution limit to $50,000, better aligning it with today’s housing market realities.
“Homeownership is one of the most important ways Americans build wealth and save for a secure retirement,” said Congresswoman Brownley. “But in high-cost states like California, too many first-time buyers are locked out of the market due to rising prices and the challenge of saving for a down payment. I am pleased to support Congresswoman Van Duyne’s efforts to update our tax code to help first-time homebuyers access their retirement savings without penalty and take that critical first step toward homeownership and a fair shot at achieving the American Dream.”
“Buying a home for the first time is not as easy as it once was,” said Congresswoman Van Duyne. “Since my time serving as Mayor of Irving, Texas, I have seen how empowering homeownership is for families, neighborhoods, and the lifetime accumulation of wealth that can be passed down to further generations. By updating and increasing the IRA withdrawal limit, we increase access to much needed capital for our first-time homebuyers. Helping Americans realize the dream of homeownership is an investment in their future and a more stable future for our country.”
“The Uplifting First-Time Homebuyers Act is a smart, targeted step toward making homeownership more attainable,” said Shannon McGahn, Executive Vice President & Chief Advocacy Officer of National Association of REALTORS. “By updating the outdated IRA withdrawal limit, this bill could give first-time buyers greater access to their own savings at the moment they need it most. With the median age of first-time buyers now at 38, this commonsense fix helps more Americans achieve the dream of homeownership earlier in life – and start building equity and long-term financial stability.”
Read the full text of the bill here.
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Issues: 119th Congress, Affordable Housing