HR 3526, the Uplifting First-Time Homebuyers Act of 2025, increases the maximum amount first-time homebuyers can withdraw penalty-free from retirement accounts. It amends the Internal Revenue Code to raise the limit from $10,000 to $50,000 for qualified first-time homebuyer distributions. This change directly affects individuals using retirement savings to purchase their first home, allowing them to access significantly more funds without incurring the usual 10% early withdrawal penalty. The provision applies to taxable years beginning after December 31, 2024.
This bill amends the tax code to allow first-time homebuyers to use funds from 529 college savings plans for home purchases without tax penalties, under specific conditions. It permits tax-free withdrawals of the original contributions (plus earnings) if the account was maintained for 15 years, the funds are used within 60 days for a first home purchase, and the total lifetime withdrawals do not exceed $35,000. If the home is sold within 5 years, a recapture tax may apply based on the time held. It directly affects first-time homebuyers who have maintained 529 plans for 15 years and use the funds for qualifying home purchases.
HR 7185, the Home Savings Act, allows individuals to exclude from taxable income certain retirement plan distributions used for down payments or closing costs when buying a principal residence. It applies to defined contribution plans (like 401(k)s), IRAs, annuity plans, and 457(b) plans, covering the individual or their eligible relatives (spouse, children, grandchildren, or ancestors). The exclusion is limited to distributions made after 2025 but expires for distributions after December 31, 2030. This policy change directly affects homebuyers using retirement savings for home purchases, reducing their taxable income for those specific expenses.
Fair Access to Co-ops for Veterans Act of 2025 This bill revives and makes permanent the authority of the Department of Veterans Affairs (VA) home loan guarantee program to guarantee loans for a veteran’s purchase of stock or membership in a cooperative housing corporation (i.e., co-op) for the purpose of entitling the veteran to occupy a single family residential unit. For purposes of the administration of such loans, the bill establishes a fee rate of the usual fee plus 3.25% of the total amount of the loan, treats such cooperative housing units as residential property for purposes of imposing restrictions and liabilities, and guarantees up to 25% of the amount of the loan for loans exceeding $144,000. Additionally, the bill requires the VA to advertise the availability of loan guarantees for cooperative housing unit loans, including by issuing guidance and notifying eligible veterans.
This bill creates a new federal tax credit for low-to-moderate income homeowners to offset energy costs. It allows a 75% credit for energy expenses (heating/cooling) exceeding 3% of a taxpayer’s modified adjusted gross income, capped at $1,500 annually ($3,000 for joint filers), and only applies to principal residences. The credit is available to individuals with modified AGI under $75,000 ($150,000 for joint returns), beginning in 2025 and expiring after 2027. It directly affects eligible homeowners facing high energy bills relative to their income, without altering other tax provisions.
This bill prohibits the Federal Emergency Management Agency (FEMA) from delaying flood map revisions (called "letters of map revision") when property owners add fill material (like soil or gravel) to their land. It directly affects homeowners and developers who need updated flood maps for construction, repairs, or insurance purposes. The provision requires FEMA to issue these revisions promptly, preventing unnecessary delays that could lead to higher flood insurance costs. The bill expires once FEMA fully implements wildlife protection requirements under the Endangered Species Act related to fill placement.
This bill expands eligibility for FEMA disaster assistance by broadening the types of evidence considered proof of property ownership for survivors without formal deeds. It allows applicants to submit documents like property tax receipts, mortgage records, insurance papers, or even death certificates (in states without will requirements) to demonstrate "constructive ownership" of their home. The bill also permits a simple signed declaration under penalty of perjury - without notarization - to support claims when other evidence is insufficient. These changes apply to disaster assistance funds appropriated after the bill's enactment, directly helping individuals affected by major disasters who lack traditional ownership documentation.
The Housing Financial Literacy Act of 2025 modifies mortgage insurance premiums for first-time homebuyers who complete approved financial literacy counseling programs. It requires that such counseling be completed before signing a mortgage application or sales agreement. The bill reduces the mortgage insurance premium by 25 basis points (0.25%) below the standard rate established by the Secretary of Housing and Urban Development. This change directly affects first-time homebuyers who participate in qualifying housing counseling programs.
HR 2748 increases the penalty-free withdrawal limit for first-time homebuyers from retirement accounts from $10,000 to $25,000 under IRS rules. This directly affects first-time homebuyers who need to access retirement savings without early withdrawal penalties. The bill also adds an inflation adjustment mechanism, automatically raising the $25,000 limit each year after 2026 based on the cost-of-living index. The changes apply to withdrawals made after December 31, 2025, for tax years ending after that date.
The Affordable Homeownership Access Act exempts small property owners who provide direct financing (owner financing) from certain mortgage licensing requirements if they make no more than 24 loans per year for properties they own. It also amends federal definitions to exclude these owner financers from "mortgage originator" rules, requiring loans to be fully amortizing, have reasonable interest rate caps, and include buyer ability-to-pay assessments. The bill mandates a study by HUD and Treasury on owner financing usage - particularly for homes under $150,000 or 60% of local median value - to evaluate its potential to boost homeownership and wealth creation in underserved communities.
