Michigan Lawmakers Pass Bills To Help First-Time Homebuyers – CBS Detroit
LANSING, me. (AP) First-time buyers could save their purchase costs through a tax-free savings account under bills passed in Michigan law to keep residents on the state workforce.
Legislation passed on Thursday would allow individuals to set aside state income tax-exempt money as long as the maximum account balance doesn’t exceed $ 50,000. Starting in 2022, individual entrants could receive up to $ 5,000 per year and $ 10,000 for joint applicants.
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Each chamber of the legislature passed identical laws with the support of both parties. However, you will not be transferring to Governor Gretchen Whitmer until the final legislative votes are in place.
Buying a first home is a major milestone, and a down payment and closing costs are a hindrance for many, Senator Ken Horn said in a statement.
“The goal of this program is to promote smart home ownership and talent retention in Michigan,” said the Frankenmuth Republican. “It’s a tool we can use to encourage people to take root here in our state.”
Michigan residents are aging and the state is losing valuable skilled workers as the population ages.
The move was supported by the Michigan Realtors, Habitat for Humanity in Michigan, the Michigan Chamber of Commerce, and the Michigan Credit Union League. The Treasury Department is against it and has concerns about its effectiveness.
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Legislation would have primary responsibility for monitoring and recording the Treasury Department’s attendance, eligibility, and compliance, said Paul Connor, Legislative Liaison for the Department, earlier during a House Committee hearing. He said the department expected low turnout.
The bills would not provide for an exemption from federal income tax, Connor said. As a result, the savings would be small, around $ 200 for individual filers and $ 400 for shared filers.
Former Governor Rick Snyder vetoed similar laws in 2018.
Anna Liz Nichols is a corps member of the Associated Press / Report for America Statehouse News Initiative. Report for America is a not-for-profit national service program in which journalists report undercover issues to local newsrooms.
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