Colorado Association of REALTORS | First-Time Homebuyer Savings Accounts
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First-Time Homebuyer Savings Accounts

Set aside up to $50,000 toward the costs of purchasing a home

First-time homebuyer savings accounts

A First‐time Homebuyer Savings Account allows any Coloradan to set aside up to $50,000 toward the costs of closing on a new home. The earnings on those funds — interest and capital gains — are free from Colorado state taxes forever.


These accounts are simple and easy to set up. Not only can you open a new one, you can also designate almost any existing account as an FHSA. To create an FHSA, you simply include a form when you file your state taxes. (It will indicate that you should not be taxed on any earnings — e.g., interest or capital gains — because of the account’s FHSA status.)


After you use the money toward the closing costs on a first home (yours or someone else’s — see below), you send in a different form to the Department of Revenue showing that the funds were put toward an “eligible cost.”

FHSAs are a great way for future homeowners to start saving early for the costs of buying a home.

Starting in 2017, consumers can apply for a first-time homebuyer savings account in the state of Colorado. Please check back for more information on participating financial institutions.

Read the Q&A

Commonly Asked Questions

Q: What kinds of accounts can be FHSAs?

A: Almost any account you have with a financial institution: mutual funds, CDs, brokerage (stocks, bonds, etc.), money markets, insurance, even a savings account. FHSAs can also include individual stocks.

Q: How much can I put in a FHSA account?

A: You can contribute up to a total of $50,000 in principal, and the account can grow in value up to $150,000. There will be an annual contribution cap of $14,000 ($28,000 if filing jointly). There is no limit on how long the account can exist.

Q: What can I use the money for?

A: A FHSA account can be used to pay for just about anything related to closing on a home — anything included on the settlement statement: closing costs, inspections, lender fees, etc. These are all considered “eligible costs.”

Q: What is considered a first‐time home buyer?

A: A first‐time buyer is: Someone who has never purchased a home before. That includes single‐family homes, condos, co-ops, townhouses, or mobile homes. (It does not include land or commercial property.) If you owned a home at some point but did not purchase one — e.g., if you inherited — you can still qualify.  It also includes someone divorced who may previously have owned a home with their spouse.

Q: Can I use the money to pay for someone else’s closing costs?

A: Yes. As long as the person you’re giving the money to (e.g., child, grandchild, niece, and even a close friend) is a first‐time homebuyer

Q: Can I use my FHSA funds if I’m buying a home with someone who is not a first‐time buyer?

A: Yes, as long as you qualify as a first‐time buyer.