Bipartisan American Homeownership Opportunity Act of 2025

This bill creates two new tax credits related to home buying and building. First-time homebuyers can get a tax credit equal to their down payment, up to $50,000, but this phases out for higher-income buyers (starting at $150,000 for single filers, $225,000 for heads of household, and $300,000 for married couples filing jointly). If the homebuyer sells, rents out, or stops living in the home within five years, they must pay back the credit by adding it to their taxable income. The bill also gives home builders a tax credit of up to 15% of construction costs for building small homes (no bigger than 1,200 square feet) that sell for no more than 80% of the area's median home price, with the credit increasing to 30% if sold to a first-time buyer. States will receive annual allocations to distribute these builder credits through their housing finance agencies.

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