How to Use the First-Time Homebuyer Savings Account Calculator
About a dozen states — including Colorado, Oregon, Virginia, and Montana — offer a First-Time Homebuyer Savings Account (FTHSA) that lets you deduct contributions from your state taxable income and grow the balance tax-free, as long as it's eventually used for an eligible home purchase. It's a straightforward way to save for a down payment while getting a state tax break most regular savings accounts don't offer. Enter your monthly deposit, months saved, interest rate, and your state's deduction rate to see the numbers.
Because it's a regular savings-style account with monthly deposits, this calculator estimates interest using an average-balance approximation (half of total deposits, since the balance builds up gradually). The state tax deduction is calculated separately — it applies each year you contribute, up to your state's annual and lifetime limits, so treat this as an illustrative one-time estimate rather than an exact multi-year projection.
Rules differ meaningfully by state: contribution limits, lifetime caps (often in the $50,000-$150,000 range), deduction percentages, and eligible uses of the funds are all set at the state level. Before opening an FTHSA, check your state treasurer's or department of revenue's website to confirm your state actually offers one and what its specific limits are.
Frequently Asked Questions
It's a special savings account offered by about a dozen states (including Colorado, Oregon, Virginia, and Montana) that lets first-time buyers deduct contributions from state taxable income and grow the balance tax-free, as long as the funds are used toward a home purchase.
No — only states that have passed enabling legislation offer this account, and contribution limits, deduction rates, and lifetime caps vary by state. Check your state treasurer's or revenue department's website for your state's specific rules before opening one.