K.S.A. 58-4901 Citation of act.
58-4901. Citation of act.
K.S.A. 58-4901 through 58-4906 , and amendments thereto, shall be known and may be cited as the first-time home buyer savings account act.
L. 2021, ch. 102, § 1; July 1.
FIRST-TIME HOME BUYER SAVINGS ACCOUNT ACT
K.S.A. ch. 58, art. 49
in effectK.S.A. 58-4902 Definitions.
58-4902. Definitions.
As used in the first-time home buyer savings account act:
(a) "Account" or "first-time home buyer savings account" means an individual savings account established in accordance with the provisions of this act.
(b) "Account holder" means an individual who establishes an account that is designated as a first-time home buyer savings account pursuant to the provisions of K.S.A. 58-4903 , and amendments thereto, with a financial institution.
(c) "Designated beneficiary" means the individual designated by an account holder pursuant to the provisions of K.S.A. 58-4903 , and amendments thereto, as the individual whose eligible expenses are expected to be paid from the account for the purchase or construction of a primary residence in this state.
(d) "Eligible expenses" means a down payment and any closing costs that may be included as part of a real estate settlement agreement, including, but not limited to, appraisal fees, mortgage origination fees and inspection fees or any down payment, costs and fees that may be included as part of financing the construction of a primary residence.
(e) "Financial institution" means any state bank, state trust company, savings and loan association, federally chartered credit union doing business in this state, credit union chartered by the state of Kansas, national bank, broker-dealer, mutual fund, insurance company or other similar financial entity qualified to do business in this state.
(f) "First-time home buyer" means an individual who:
(1) Has never owned or purchased under contract for deed, either individually or jointly, a single-family, owner-occupied primary residence including, but not limited to, a condominium unit or a manufactured or mobile home that was assessed and taxed as real property; or
(2) as a result of the individual's dissolution of marriage, has not been listed on a property title for at least three consecutive years.
(g) "Secretary" means the secretary of revenue.
L. 2021, ch. 102, § 2; July 1.
K.S.A. 58-4903 Designation of first-time home buyer savings account; designated beneficiary; contribution limits; responsibilities of account holder; survivorship interest not created for designated beneficiary; payment of such account upon death of account holder.
58-4903. Designation of first-time home buyer savings account; designated beneficiary; contribution limits; responsibilities of account holder; survivorship interest not created for designated beneficiary; payment of such account upon death of account holder.
(a) On and after July 1, 2022, any individual may open an account with a financial institution and designate the account, in its entirety, as a first-time home buyer savings account to be used to pay or reimburse a designated beneficiary's eligible expenses for the purchase or construction of a primary residence in this state. An individual may be the account holder of multiple accounts and an individual may jointly own the account with another individual if such individuals file a joint income tax return. An account holder shall comply with the requirements of this act to be eligible for the modifications set forth in K.S.A. 79-32,117 , and amendments thereto.
(b) (1) An account holder shall designate, no later than April 15 of the year following the taxable year during which the account is established, a first-time home buyer as the designated beneficiary of the account. Nothing in this section shall prohibit an account holder from designating such account holder as the designated beneficiary of an account. An account holder may change the designated beneficiary at any time, but no account shall have more than one designated beneficiary at any time. An individual may be designated as the designated beneficiary of more than one account if such accounts are held by separate account holders. No account holder shall be authorized to designate the same designated beneficiary on multiple accounts held by such account owner.
(2) The naming of a designated beneficiary shall not create a survivorship interest in the account for such designated beneficiary. In the event of the death of an account holder, the balance of such account shall be paid to the payable on death beneficiary in accordance with K.S.A. 9-1215 , and amendments thereto, or, in the absence of a named payable on death beneficiary, in accordance with the provisions of the Kansas probate code.
(c) (1) The following limits apply to an account established pursuant to this act:
(A) The maximum contribution to an account in any tax year shall be $3,000 for an individual and $6,000 for a married couple filing a joint return;
(B) the maximum amount of all contributions into an account in all tax years shall be $24,000 for an individual and $48,000 for a married couple filing a joint return; and
(C) the maximum total amount in an account shall be $50,000.
(2) If a limit in paragraph (1) is exceeded, then thereafter all interest or other income earned on the investment of moneys in an account shall be subject to the tax imposed by the Kansas income tax act.
(3) Moneys may remain in an account for an unlimited duration without the interest or income being subject to recapture or penalty.
(d) The account holder shall not use moneys in an account to pay expenses of administering the account, except that a service fee may be deducted from the account by a financial institution. The account holder shall be responsible for maintaining documentation for the account and for eligible expenses related to the designated beneficiary's purchase or construction of a primary residence.
L. 2021, ch. 102, § 3; L. 2023, ch. 5, § 2; July 1.
K.S.A. 58-4904 Use of account moneys; withdrawals; subject to recapture, when; penalty.
58-4904. Use of account moneys; withdrawals; subject to recapture, when; penalty.
(a) (1) The moneys in a first-time home buyer savings account may be:
(A) Used for eligible expenses related to a designated beneficiary's purchase or construction of a primary residence located in this state;
(B) used for eligible expenses related to a designated beneficiary's purchase or construction of a primary residence located outside of this state if such designated beneficiary is active-duty military and was stationed in Kansas for any time after the creation of the account;
(C) used for eligible expenses that would have qualified pursuant to paragraph (1)(A) or (1)(B) but the contract for purchase or construction did not close;
(D) transferred to another newly created account; and
(E) used to pay service fees assessed by the financial institution.
(2) This subsection shall apply even if a designated beneficiary is a joint owner of a primary residence with another person who is not a designated beneficiary of an account. Moneys in an account shall not be used to purchase a manufactured or mobile home that is not taxed as real property.
(b) Moneys withdrawn from an account shall be subject to recapture by the secretary in the tax year in which they were withdrawn if:
(1) At the time of the withdrawal, it has been less than a year since the first deposit in the account; or
(2) the moneys are used for any purpose other than the expenses or transactions authorized pursuant to subsection (a)(1).
(c) Moneys that are subject to recapture shall be an amount equal to the moneys withdrawn from an account and shall be added to the Kansas adjusted gross income pursuant to K.S.A. 79-32,117 (b), and amendments thereto, of the account holder or, if the account holder is no longer living, the designated beneficiary. If any moneys are subject to recapture, the account holder shall pay a penalty in the following amounts: (1) If the withdrawal of moneys occurred 10 or less years after the first deposit in the account, 5% of the amount subject to recapture; and (2) if the withdrawal of moneys occurred more than 10 years after the first deposit in the account, 10% of the amount subject to recapture.
(d) The penalties provided in subsection (c) shall not apply if: (1) The withdrawn moneys are used for eligible expenses related to a designated beneficiary's purchase or construction of a primary residence outside of this state; or (2) the withdrawn moneys are from an account in which the designated beneficiary died, and the account holder did not designate a new designated beneficiary during the same tax year.
(e) If the account holder dies or, if the account is jointly owned and the account owners die, and the account does not have a surviving payable on death beneficiary, then all of the moneys in the account resulting from contributions or income earned from assets in the account pursuant to K.S.A. 79-32,117 , and amendments thereto, shall be subject to recapture in the tax year of the death or deaths, but no penalty shall be assessed pursuant to subsection (c).
L. 2021, ch. 102, § 4; L. 2023, ch. 5, § 3; July 1.
K.S.A. 58-4905 Annual reporting; forms; rules and regulations.
58-4905. Annual reporting; forms; rules and regulations.
(a) The secretary shall establish forms for an account holder to annually report information about any accounts held by such account holder. An account holder shall annually file with the account holder's state income tax return all forms required by the secretary under this section, the form 1099 for the account issued by the financial institution and any other supporting documentation the secretary requires.
(b) Prior to July 1, 2022, the secretary shall adopt rules and regulations necessary to administer the provisions of the first-time home buyer savings account act.
L. 2021, ch. 102, § 5; July 1.
K.S.A. 58-4906 Actions that are not a requirement of nor the responsibility or liability of financial institutions; determining a payable on death beneficiary.
58-4906. Actions that are not a requirement of nor the responsibility or liability of financial institutions; determining a payable on death beneficiary.
(a) No financial institution shall be required to:
(1) Designate an account as a first-time home buyer savings account or designate the beneficiaries of an account in the financial institution's account contracts or systems or in any other way;
(2) track the use of moneys withdrawn from an account; or
(3) report any information to the department of revenue or any other governmental agency that is not otherwise required by law.
(b) No financial institution shall be responsible or liable for:
(1) Determining or ensuring that an account holder is eligible for a Kansas adjusted gross income modification pursuant to K.S.A. 79-32,117 , and amendments thereto;
(2) determining or ensuring that moneys in the account are used for eligible expenses; or
(3) reporting or remitting taxes or penalties related to the use of account moneys.
(c) A financial institution may rely on such financial institution's account records for determining a payable on death beneficiary for a first-time home buyer savings account. If the payable on death beneficiary in a financial institution's account records conflicts with the designated beneficiary on any form required by the secretary under the first-time home buyer savings account act, the payable on death beneficiary in such financial institution's account records shall control.
L. 2021, ch. 102, § 6; L. 2023, ch. 5, § 4; July 1.
K.S.A. 58-4907 Non-exclusive authority to market the first-time home buyer savings account program by the state treasurer.
58-4907. Non-exclusive authority to market the first-time home buyer savings account program by the state treasurer.
(a) The state treasurer may have non-exclusive authority to market the first-time home buyer savings account program to account holders and financial institutions throughout the state and may report on the marketing initiatives in the state treasurer's office annual report.
(b) This section shall be a part of and supplemental to the first-time home buyer savings account act.
L. 2023, ch. 5, § 1; July 1.
Source: Kansas Office of Revisor of Statutes (ksrevisor.gov)URL: https://www.ksrevisor.gov/statutes/ksa_ch58.htmlFetched: 10/20/2026