First Time Homeowner Savings Plan Act

This bill amends the Internal Revenue Code of 1986 to significantly increase the amount individuals can withdraw from their individual retirement plans without penalty for a first-time home purchase. It raises the penalty-free distribution limit from $10,000 to $25,000 , aiming to provide greater financial flexibility for first-time homebuyers. These changes will apply to distributions made after December 31, 2025, in taxable years ending after that date. Additionally, the legislation includes a provision for an inflation adjustment , ensuring the $25,000 limit is periodically updated for taxable years beginning after 2026 to maintain its purchasing power.