Lets people use college savings plans to buy their first home without extra taxes.
This bill would let people use money from their 529 college savings plans to pay for a first home. They would avoid income tax and an extra 10% tax on these funds. This applies if they are first-time homebuyers. This change would take effect for money taken out after December 31, 2026.
Today, if you take money out of a 529 college savings plan for anything other than education, you usually pay income tax on the earnings. You also pay an extra 10% tax. After this bill, if you are a first-time homebuyer, you would be able to use those 529 funds for certain housing costs. These costs include buying a main home, closing costs, or mortgage payments. You would not pay those taxes.
HR 7393 · 119th Congress · February 5, 2026 · AI Summary by gemini-2.5-flash · 10/10
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