§ 39-22-4704 — First-time home buyer savings account

Colorado § 39-22-4704

• Jurisdiction: Colorado
• Title 39: Taxation
• Art.: Income Tax

Text

(1) Beginning January
1, 2017, and prior to January 1, 2025, any individual may open an account with a
financial institution and designate the account, in its entirety, as a first-time home
buyer savings account to be used to pay or reimburse a qualified beneficiary's
eligible expenses for the purchase of a primary residence in Colorado. An individual
may be the account holder of multiple accounts, and an individual may jointly own
the account with another person if they file a joint income tax return. To be eligible
for the subtraction under section 39-22-104 (4)(w)(I), an account holder must
comply with the requirements of this section.

(2) An account holder must designate, no later than April 15 of the year
following the taxable year during which the account is established, a first-time
home buyer as the qualified beneficiary of the first-time home buyer savings
account. The account holder may designate himself or herself as the qualified
beneficiary. The account holder may change the designated qualified beneficiary at
any time, but there may not be more than one qualified beneficiary at any time. An
account holder cannot have multiple accounts with the same qualified beneficiary,
but an individual may be designated as the qualified beneficiary of multiple
accounts.

(3) (a) The following limits apply to a first-time home buyer savings account:

(I) The maximum contribution to a first-time home buyer savings account for
a taxable year is fourteen thousand dollars for an individual and twenty-eight
thousand dollars for account holders who file a joint return;

(II) The maximum amount of all contributions for all taxable years to a first-time home buyer savings account is fifty thousand dollars; and

(III) The maximum total amount in an account is one hundred fifty thousand
dollars.

(b) If a limit in paragraph (a) of this subsection (3) is exceeded, then
thereafter no interest or other income earned on the investment of money in a first-time home buyer savings account may be subtracted from taxable income under
section 39-22-104 (4)(w)(I).

(c) Money may remain in a first-time home buyer savings account for
unlimited duration without the interest or income being subject to recapture or
penalty.

(4) The account holder shall not use money in an account to pay expenses of
administering the account; except that a service fee may be deducted from the
account by a financial institution. The account holder is responsible for maintaining
documentation for the first-time home buyer savings account and for eligible
expenses related to the qualified beneficiary's purchase of his or her primary
residence.

Legislative History

Source: L. 2016: Entire part added, (HB 16-1467), ch. 321, p. 1303, � 2, effective August 10. L. 2024: (1) amended, (HB 24-1036), ch. 373, p. 2532, � 24, effective August 7.