READY Accounts Act
Sponsored By: Representative Lee (FL)
Introduced
Summary
Would create a new tax-deductible savings account called READY accounts to help homeowners save for disaster mitigation and recovery. It would allow a per-taxpayer deduction for cash contributions, capped at $4,500 a year with automatic inflation adjustments after 2025.
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- Homeowners: READY funds could pay tax-free for qualified home disaster mitigation and recovery costs on a taxpayer's principal residence. Eligible mitigation measures include roof upgrades, impact-resistant windows and doors, elevating the home, ground anchors, attic/roof connections, and other measures certified by a qualified professional in consultation with the Federal Emergency Management Agency (FEMA).
- Taxpayers and savers: Contributions are deductible up to $4,500 per taxpayer each year and earnings are tax-exempt when used for qualified expenses. Non-qualified distributions are included in income and face a 20% additional tax on the includible amount.
- Account rules and administrators: READY accounts must be U.S. trusts run by a bank or a Secretary-approved trustee, cannot buy life insurance, must keep assets separate, and are nonforfeitable. The bill also sets rules for rollovers, excess contributions, divorce transfers, and treatment at death.
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Bill Overview
Analyzed Economic Effects
4 provisions identified: 1 benefits, 0 costs, 3 mixed.
New disaster savings accounts for homeowners
This bill would create special savings accounts for your main home. You could deduct up to $4,500 each year for cash you put in, for tax years starting after December 31, 2024. After 2025, the limit would rise with inflation and be rounded down to the nearest $50. Money must be used for certified disaster repairs or prevention on your principal home. Accounts would need a bank or approved trustee and follow strict rules.
Tax rules for disaster account withdrawals
If enacted, money you spend only on qualified repairs or prevention would not be taxed. Other uses would be taxable and add a 20% extra tax on that amount. Accounts would be tax-exempt while they qualify, and could owe unrelated business income tax in limited cases. You could transfer an account to a spouse in a divorce without tax in some cases; a surviving spouse would take over the account, while other heirs could owe income tax. These rules would apply for tax years beginning after December 31, 2024.
60-day rollovers and tax on excess
You would be able to roll a withdrawal into another disaster account within 60 days. You could use this rollover only once in a 12-month period. If you put in too much, you could fix it by your tax filing deadline by withdrawing the excess and its earnings; the earnings would be taxable. If excess amounts remain, an excise tax would apply under the excess-contribution rules. These rules would apply for tax years beginning after December 31, 2024.
Reporting rules and no double-dip on losses
Trustees could be required to report contributions and withdrawals to the IRS and to you. The IRS would issue rules to run the program and prevent abuse. You would not also be able to claim a casualty loss for the same spending paid from the account. The bill would add technical cross-references so tax rules line up. These changes would apply for tax years beginning after December 31, 2024.
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Sponsors & CoSponsors
Sponsor
Lee (FL)
FL • R
Cosponsors
Rep. Moskowitz, Jared [D-FL-23]
FL • D
Sponsored 1/15/2025
Buchanan
FL • R
Sponsored 1/15/2025
Franklin, Scott
FL • R
Sponsored 1/15/2025
Bilirakis
FL • R
Sponsored 2/4/2025
McClain Delaney
MD • D
Sponsored 6/24/2025
Van Drew
NJ • R
Sponsored 8/22/2025
Rep. Patronis, Jimmy [R-FL-1]
FL • R
Sponsored 11/20/2025
Rutherford
FL • R
Sponsored 2/9/2026
Roll Call Votes
No roll call votes available for this bill.
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