Representatives Jimmy Patronis (R-FL) and Gus Bilirakis (R-FL) have introduced H.R. 7393, the Save for Success Act, to allow distributions from qualified tuition programs to be used for qualified housing expenses for first-time homebuyers. The legislation would amend IRC Sec. 529(c)(3) to provide that “qualified housing expenses” for a first-time homebuyer to purchase a principal residence, including closing costs and mortgage payments, would not be includible in gross income. A first-time homebuyer is someone who, along with their spouse if married, did not own a principal residence at any time during the three years before the purchase. 

The change would apply to eligible distributions made after December 31, 2026. The bill has been referred to the House Committee on Ways and Means.