DES MOINES | Iowans looking to buy their first home could benefit from a special savings account being contemplated by the Iowa Senate.
Senate Study Bill 3205 would allow first-time homebuyers who are Iowa residents to establish an interest-bearing account with a financial institution.
Yearly contributions and interest for participants would be exempt from state income taxes up to $3,000 per individual and $6,000 for couple annually for 10 years.
The program is modeled after a Montana law and would require that the money be used for a down payment or a home purchase at the time of withdrawal. Otherwise it would be subject to taxation and penalty if used for a different purpose.
The bill got its first look from a Senate Ways and Means subcommittee on Wednesday, but members requested more information before forwarding the issue to the full committee.
-- Globe Gazette Des Moines Bureau