Could a Montana First-Time Home-Buyer Savings Account Help You?

Marsha Goetting
MSU Extension Family Economics Specialist

1/26/2000 - BOZEMAN –Are you saving money for the purchase of your first home? A First-Time Home-Buyer Savings Account may help.

"If you are saving for a first home, you should be aware that Montana law allows you have a special savings account to pay for eligible home buyer expenses and receive a reduction in Montana state income taxes," says Marsha A. Goetting, MSU Extension Family Economics Specialist.

The maximum amount that can be used to reduce Montana taxable income, however, is limited to $3,000 annually for each taxpayer. As long as the money is left in the first time home buyer savings account (or withdrawn for eligible expenses), it is not subject to income taxation at the state level. However, the amount is subject to taxation at the federal level.

First time home buyer savings accounts can be established at a state or federally chartered bank, a savings and loan, a credit union, a trust company, a mutual fund company or with a brokerage firm. The account must be kept separate from all other accounts. It must be maintained specifically for the purchase of a single-family home by the account holder.

You can receive further information by three methods:

--Request MSU Extension MontGuide 9918, "Montana First-Time Home Buyer Savings Account" from your County Extension Office,

--Download it at: http://www.montana.edu/wwwpb/pubs/mt9918.html or,

--Request a copy from Marsha A. Goetting, P. O. Box 172800, MSU, Bozeman, MT 59717.

Send questions or comments to Goetting and Suzi Taylor, MSU Communications Services, Bozeman, MT 59717 or email them at taylor@montana.edu.

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