3. “Beneficiary" means a first-time home buyer who is designated by an 10
account holder as the beneficiary of an account under this subsection.
4. “Eligible costs” means the down payment and allowable closing costs for the 12
purchase of a single-family residence in this state by a beneficiary.
5. “Financial institution" means any bank, trust company, savings institution, 14
savings bank, savings and loan association, industrial loan association, consumer 15
finance company, credit union, or any benefit association, insurance company, safe 16
deposit company, money market mutual fund, or similar entity authorized to do 17
business in this state.
6. “First-time home buyer” means an individual who resides in this state and 19
has not owned or purchased, either individually or jointly, a single-family residence 20
during the 36 months before the month in which the individual purchases a 21
single-family residence in this state.
7. “Single-family residence” means a residence intended for occupation by a 23
single family unit that is owned and occupied by a beneficiary as his or her principal 24
residence, including a manufactured home, residential trailer, mobile home, 25
condominium unit, or cooperative.
(b) Creation of account
. 1. An individual may become an account holder by 2
creating an account at a financial institution to pay or reimburse the eligible costs 3
of a first-time home buyer.
2. The account holder shall designate a beneficiary when the account is created. 5
The account holder may designate himself or herself as the beneficiary. An account 6
holder may change the beneficiary at any time. No account created under this 7
subsection may have more than one beneficiary at any one time.
3. An individual may jointly own an account created under this subsection with 9
his or her spouse.
4. An individual may be the account holder of more than one account created 11
under this subsection, but an account holder may not have more than one account 12
that designates the same beneficiary.
5. An individual may be the beneficiary of more than one account created under 14
6. Only cash and marketable securities may be contributed to an account under 16
7. Persons other than an account holder may contribute to an account created 18
under this subsection, but the subtraction under s. 71.05 (6) (b) 54. may be claimed 19
only by an account holder.
(c) Account holder rights and responsibilities.
1. An account holder may 21
withdraw funds from an account created under this subsection to pay eligible costs 22
for the benefit of the beneficiary or to reimburse the beneficiary for eligible costs the 23
beneficiary incurs and has paid.
2. An account holder may not use funds in an account created under this 2
subsection to pay any expenses he or she incurs in administering the account, 3
although a financial institution may deduct a service fee from the account.
3. Annually, an account holder shall submit to the department of revenue with 5
his or her income tax return, on forms prepared by the department, detailed 6
information regarding the account. The information submitted shall include all of 7
a. A list of transactions in the account during the taxable year to which the 9
account holder's return relates, including the beginning and ending balance of the 10
b. The 1099 form issued by the financial institution that relates to the account.
c. A list of eligible costs, and other costs, for which funds from the account were 13
withdrawn during the taxable year to which the account holder's return relates.
4. An account holder may withdraw funds from the account with no penalty due 15
under s. 71.83 (1) (ch) and no responsibility to make an addition under s. 71.05 (6) 16
(a) 29., if he or she immediately transfers the funds to a different financial institution 17
and deposits the funds into an account created under this subsection at that financial 18
(d) Limitations on accounts, dissolution.
1. An account holder may not claim 20
a subtraction under s. 71.05 (6) (b) 54. for more than a total of $50,000 of deposits into 21
an account for each beneficiary.
2. An account holder shall dissolve an account created under this subsection 23
not later than 120 months after it is created by the account holder.
3. If funds remain in an account when it must be dissolved under subd. 2., the 2
financial institution shall distribute the proceeds in the account to the account 3
4. If an account holder dies while funds remain in the account, the proceeds 5
shall be distributed to the account holder's estate.
(e) Department responsibilities.
The department shall:
1. Prepare and distribute any forms that an account holder is required to 8
submit under this subsection, and any other forms that the department believes are 9
necessary to enable it to administer this subsection and the adjustments to income 10
under s. 71.05 (6) (a) 29. and (b) 54.
2. Prepare and distribute to financial institutions and potential home buyers 12
informational materials about the accounts described in this subsection.
71.83 (1) (ch) of the statutes is created to read:
(ch) First-time home buyers savings account withdrawals.
If an 15
account holder, as defined under s. 71.10 (10) (a) 1., or an account holder's estate is 16
required to add any amount to federal adjusted gross income under s. 71.05 (6) (a) 17
29., the account holder or the account holder's estate shall also pay an amount equal 18
to 10 percent of the amount that was added to income under s. 71.05 (6) (a) 29. The 19
department of revenue shall assess, levy, and collect the penalty under this 20
paragraph as it assesses, levies, and collects taxes under this chapter.
(1) This act first applies to taxable years beginning on January 1, 2020.