READY Accounts Act | ChamberLight

IN COMMITTEE· 119TH CONGRESS

House BillHR 440Taxation

READY Accounts Act

INTRO JAN 15· LAST ACTION JAN 15

READING

14MIN

COSPONSORS

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Introduced

In Committee

Reported

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Passed Senate

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To President

Became Law

WHAT THE BILL DOES

AI-written

This bill matters because it encourages and financially supports homeowners in making their homes safer and more resilient against natural disasters. By offering a tax deduction and tax-free growth, it lowers the financial barrier for people to invest in critical measures like stronger roofs or floodproofing, which can save lives and reduce property damage when a disaster strikes. If this bill becomes law, homeowners will have a dedicated, tax-advantaged way to save for these crucial expenses, potentially reducing their out-of-pocket costs and reliance on emergency aid after a disaster. Without it, homeowners might continue to face the full financial burden of preparedness and recovery, which can be significant, especially with increasing natural disaster frequency and intensity.

KEY PROVISIONS

5AI-extracted

PROVISION 01

Allows individuals to deduct cash contributions made to a READY Account from their taxable income each year.

This provides a direct financial incentive for homeowners to save for disaster preparedness and recovery by reducing their annual tax burden.

PROVISION 02

Sets an annual contribution limit of $4,500 per individual, which will be adjusted for inflation in years after 2025.

This caps the tax benefit while allowing the savings power to keep pace with rising costs over time.

PROVISION 03

Establishes that money within a READY Account grows tax-free and withdrawals are tax-free if used for 'qualified home disaster mitigation and recovery expenses'.

This double tax benefit (deduction for contributions, tax-free growth and withdrawals) makes the account a powerful tool for building disaster resilience.

PROVISION 04

Defines 'qualified home disaster mitigation measures' to include specific actions like installing stronger roofing, impact-resistant windows, or elevating a home to meet current building codes.

This ensures that the tax-advantaged funds are used for effective and approved measures that genuinely increase a home's safety and resilience.

PROVISION 05

Includes 'qualified disaster recovery costs' for repairing uninsured damage to a principal residence from fire, storm, or other casualty.

This helps homeowners cover gaps in their insurance coverage after a disaster, providing a financial safety net for essential repairs.

SPONSORSHIP

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COSPONSOR BREAKDOWNBIPARTISAN · 60%

DEM 3 REP 7 IND 0

ACTION TIMELINE

2 EVENTS

JAN 15

Introduced in House

INTROREFERRAL

JAN 15

Referred to the House Committee on Ways and Means.

HOUSE · INTROREFERRAL

BILL INFO

TypeHouse Bill

NumberHR 440

Congress119th

StatusIn Committee

IntroducedJan 15, 2025

Last actionJan 15, 2025

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IN COMMITTEE· 119TH CONGRESS · WAYS AND MEANS COMMITTEE · INTRODUCED JAN 15, 2025

House BillHR 440Taxation

READY Accounts Act

INTRODUCED JAN 15, 2025· LAST ACTION JAN 15, 2025

PASSAGE CHANCES

—%

READING

14 min

COSPONSORS

COMPLEXITY

Moderate

Call my reps Congress.gov

LEGISLATIVE PROGRESS

STEP 2 OF 8

Introduced

In Committee

Reported

Passed House

Passed Senate

Conference

To President

Became Law

Introduced
In Committee
Reported
Passed House
Passed Senate
Conference
To President
Became Law

WHAT THE BILL DOES

AI-written

KEY PROVISIONS

AI-extracted

high

Allows individuals to deduct cash contributions made to a READY Account from their taxable income each year.

This provides a direct financial incentive for homeowners to save for disaster preparedness and recovery by reducing their annual tax burden.

med

Sets an annual contribution limit of $4,500 per individual, which will be adjusted for inflation in years after 2025.

This caps the tax benefit while allowing the savings power to keep pace with rising costs over time.

high

Establishes that money within a READY Account grows tax-free and withdrawals are tax-free if used for 'qualified home disaster mitigation and recovery expenses'.

This double tax benefit (deduction for contributions, tax-free growth and withdrawals) makes the account a powerful tool for building disaster resilience.

med

Defines 'qualified home disaster mitigation measures' to include specific actions like installing stronger roofing, impact-resistant windows, or elevating a home to meet current building codes.

This ensures that the tax-advantaged funds are used for effective and approved measures that genuinely increase a home's safety and resilience.

med

Includes 'qualified disaster recovery costs' for repairing uninsured damage to a principal residence from fire, storm, or other casualty.

This helps homeowners cover gaps in their insurance coverage after a disaster, providing a financial safety net for essential repairs.

DEADLINES & DATES

AI-extracted

An AI model extracted this from the bill’s official record and can make mistakes. Check the official text ↗ (opens in new tab)

After calendar year 2025

The $4,500 contribution limit will be adjusted for inflation for any taxable year beginning in a calendar year after 2025.

PENALTIES & ENFORCEMENT

AI-extracted

An AI model extracted this from the bill’s official record and can make mistakes. Check the official text ↗ (opens in new tab)

TYPE	AMOUNT	WHO
administrative	Loss of tax-exempt status for the account if it ceases to meet requirements (e.g., due to prohibited transactions).	Account beneficiary
civil	The fair market value of the account assets may be treated as taxable income if the account ceases to be a READY account due to certain actions, similar to IRA rules.	Account beneficiary

GLOSSARY

AI-written

Internal Revenue Code (IRC): The body of federal tax laws in the United States, administered by the Internal Revenue Service (IRS).
Deduction: An amount that can be subtracted from a person's gross income to reduce the amount of income subject to tax.
Taxable Year: The annual accounting period for which income is calculated for tax purposes, typically the calendar year for individuals.
Qualified Home Disaster Mitigation Measures: Specific actions, like strengthening roofs or installing impact-resistant windows, that are approved to reduce damage to a home from natural disasters.
Qualified Disaster Recovery Costs: Expenses for repairing damage to a person's primary home caused by a fire, storm, or other casualty, but only if those costs are not covered by insurance or other compensation.
Principal Residence: The main home where a person lives most of the time, as opposed to a vacation home or investment property.
Tax-Exempt: Status indicating that certain income, organizations, or assets are not subject to federal, state, or local taxes.

ACTION TIMELINE

2 EVENTS

JAN 15, 25

Introduced in House

INTROREFERRAL

JAN 15, 25

Referred to the House Committee on Ways and Means.

INTROREFERRAL

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READY Accounts Act

LEGISLATIVE PROGRESS

WHAT THE BILL DOES

KEY PROVISIONS

SPONSORSHIP

ACTION TIMELINE

BILL INFO

READER REACTIONS

Discussion

READY Accounts Act

LEGISLATIVE PROGRESS

WHAT THE BILL DOES

KEY PROVISIONS

DEADLINES & DATES

PENALTIES & ENFORCEMENT

GLOSSARY

ACTION TIMELINE

SPONSORS

READER REACTIONS

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