First Time Home Buyer Savings Account

The First Time Home Buyer Savings Account is a special type of savings account created to help Iowans save for their first home.  It includes provisions that allow individuals, including those who already own a home, to make tax-deductible contributions into an account to be used by a designated person saving to own their first home.



  • Interest Bearing
  • Account holders may exclude from their Iowa adjusted gross income yearly deposits into First Time Home Buyer Savings Account in amounts up to $2,000/yr.  Married taxpayers who file a joint return may exclude up to $4,000/yr. if the account is opened and maintained as a joint account. 
  • Income from interest earned on a First Time Home Buyer Savings Account isn't taxable on State of Iowa tax returns.
  • The State of Iowa tax deductions for account contributions is available for up to ten years.


Frequently Asked Questions:

What defines a first time homebuyer?

A first time homebuyer is an individual who is a resident of Iowa and who doesn't own a residence for a period of three years prior to the date on which the individual is named as a designated beneficiary of a First Time Home Buyer Savings Account and the date of the qualified home purchase for which the eligible home costs are paid or reimbursed from a First Time Home Buyer Savings Account.

Can I open a First Time Home Buyer Savings Account if I already own a home?

Yes.  If the account is established for the purpose of paying or reimbursing a designated beneficiary's eligible home costs in connection with a qualified home purchase.  You can not be the account's designated beneficiary. 

Can I open more than one First Time Home Buyer Savings Account?


What type of home can I buy?

The funds must be used for a qualified home purchase, defined as a single-family residence in Iowa.

How long can I deduct my contributions?

The deduction for contributions is subject to a lifetime limit of ten times the account holder's annual deduction limit.  This would be reached in ten years if full allowable contributions were made yearly. 

When can a beneficiary use the funds?

The account must be open a minimum of 90 days before funds can be used toward a qualified home purchase.

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