Michigan House Bill HB5806

Michigan 2023-2024 Regular Session

• Introduced: 6/12/24
• Refer: 6/12/24

Caption

Individual income tax: credit; credit for the down payment on the purchase of a home; provide for. Amends 1967 PA 281 (MCL 206.1 - 206.847) by adding sec. 280.

Impact

The bill is expected to reduce the financial burden on homebuyers, potentially encouraging more individuals to invest in property. By providing a financial incentive through tax credits, the legislation seeks to promote home purchasing, which could lead to broader economic benefits, including increased real estate activity and support for related industries. Additionally, this measure aligns with ongoing state efforts to address housing affordability and availability issues.

Summary

House Bill 5806 proposes to amend the Income Tax Act of 1967 by introducing a tax credit for individuals making down payments on the purchase of a single-family residence. Beginning in the tax year 2025, eligible taxpayers can claim a credit equal to 10% of their down payment, capped at a maximum of $3,000. This initiative aims to assist first-time homebuyers and stimulate the housing market by making homeownership more accessible.

Contention

Debates surrounding HB5806 may include concerns about the state’s revenue implications due to the introduction of such tax credits. Critics might argue that while the intent is positive, the potential loss of tax revenue could hinder state funding for essential services. Furthermore, discussions might address whether the bill effectively targets those who truly need assistance, or if it could inadvertently benefit higher-income households that would buy homes regardless of the credit.