H.R. 7393: Save for Success Act

The Save for Success Act aims to amend the Internal Revenue Code to allow individuals to use funds from qualified tuition programs for housing expenses. Here’s a breakdown of the key components of the bill:

Key Provisions

• Distributions for Housing Expenses: The bill permits distributions from qualified tuition programs to be used for qualified housing expenses, provided the recipient is a designated beneficiary.
• Definition of Qualified Housing Expense: A qualified housing expense includes costs associated with purchasing a principal residence for first-time homebuyers. This encompasses closing costs and mortgage payments related to the purchase.
• First-Time Homebuyer Definition: The bill defines a first-time homebuyer as an individual who, along with their spouse (if applicable), has not owned a principal residence during the three years leading up to the purchase of their new home.
• Principal Residence: The bill considers the term “principal residence” as defined in the relevant section of the tax code.
• Effective Date: The changes proposed in this bill would apply to distributions made after December 31, 2026.

Overall Impact

In essence, this bill expands the ways that individuals can utilize funds from their qualified tuition programs, allowing them to support their home purchasing efforts through these educational savings accounts. It encourages homeownership among first-time buyers while using money that was originally set aside for educational purposes.

Relevant Companies

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