25 LC 50 1210S/AP
House Bill 511 (AS PASSED HOUSE AND SENATE)
By: Representatives Lumsden of the 12
th
, Blackmon of the 146
th
, Williams of the 148
th
,
Burchett of the 176
th
, Hatchett of the 155
th
, and others
A BILL TO BE ENTITLED
AN ACT
To amend Article 2 of Chapter 7 of Title 48 of the Official Code of Georgia Annotated,
1
relating to income tax imposition, rate, computation, exemptions, and credits, so as to2
provide for tax advantaged catastrophe savings accounts; to establish limits for contributions3
to and withdrawals from such accounts; to provide for tax treatment of contributions, interest,4
and withdrawals; to provide for definitions; to provide for rules and regulations; to provide5
for related matters; to provide for an effective date and applicability; to repeal conflicting6
laws; and for other purposes.7
BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:8
SECTION 1.9
Article 2 of Chapter 7 of Title 48 of the Official Code of Georgia Annotated, relating to10
income tax imposition, rate, computation, exemptions, and credits, is amended by adding a11
new Code section to read as follows:12
"48-7-28.5.
13
(a) As used in this Code section, the term:14
(1) 'Catastrophe savings account' means a regular savings account or money market15
account established by a resident taxpayer to pay for qualified catastrophe expenses.16
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(2) 'Catastrophic event' means windstorms, cyclones, earthquakes, hurricanes, ice storms,17
tornadoes, high winds, floods, hail storms, and any other weather events or occurrences,18
provided that such event or occurrence has been declared as a disaster or emergency by19
the Governor.20
(3) 'Qualified catastrophe expenses' means:21
(A) A qualified deductible paid for damage resulting from a catastrophic event; and22
(B) Expenses incurred in repairing or replacing damage to a taxpayer's primary23
residence as a result of a catastrophic event that are not covered by a homeowner's24
insurance policy.25
(4) 'Qualified deductible' means the deductible for the homeowner's insurance policy of26
the taxpayer covering catastrophic event damage for his or her primary residence. If such27
policy provides for more than one deductible, the deductible with the highest amount28
shall constitute the qualified deductible.29
(b) A taxpayer may establish one catastrophe savings account pursuant to this Code30
section which shall be labeled as a catastrophe savings account and shall specify that the31
purpose of the account is to cover qualified catastrophe expenses. No more than one32
catastrophe savings account pursuant to this Code section shall be established for a primary33
residence.34
(c)(1) For a taxpayer whose qualified deductible is $1,000.00 or less, the total amount35
that may be contributed to a catastrophe savings account shall not exceed $2,000.00.36
(2) For a taxpayer whose qualified deductible is greater than $1,000.00, the total amount37
that may be contributed to a catastrophe savings account shall not exceed the lesser of38
twice the amount of the taxpayer's qualified deductible or $25,000.00.39
(3) For a self-insured taxpayer who chooses not to obtain insurance on his or her primary40
residence, the total amount that may be contributed to a catastrophe savings account shall41
not exceed $250,000.00; provided, however, that in no case shall the amount contributed42
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to the catastrophe savings account exceed the fair market value of the taxpayer's primary43
residence.44
(d)(1) An individual taxpayer shall be allowed a deduction from the tax imposed45
pursuant to this article for amounts contributed to a catastrophe savings account in46
accordance with this Code section.47
(2) All interest income earned by a catastrophe savings account in compliance with this48
Code section shall be exempt from the tax imposed pursuant this article.49
(3) A distribution from a catastrophe savings account shall be included in the income of50
the taxpayer unless the amount of the distribution is used to cover qualified catastrophe51
expenses; provided, however, that no such amount shall be included in the income of the52
taxpayer if the qualified catastrophe expenses of the taxpayer during the taxable year are53
equal to or greater than the aggregate distributions from such account during the taxable54
year. If the aggregate distributions during the taxable year from such account exceed the55
qualified catastrophe expenses of the taxpayer during the taxable year, the amount56
otherwise included in the taxpayer's income shall be reduced by the amount of the57
distributions for qualified catastrophe expenses and the amount of interest income earned58
by the catastrophe savings account.59
(e)(1) If a taxpayer contributes in excess of the limits provided in this Code section and60
claimed a deduction pursuant to subsection (d) of this Code section, the taxpayer shall61
withdraw the amount of the excess contributions and include that amount in the income62
of the taxpayer in the year of withdrawal.63
(2) If a taxpayer who owns a catastrophe savings account dies, his or her account shall64
be included in the income of the person who receives the account, unless that person is65
the surviving spouse of the taxpayer. Upon the death of such a surviving spouse, the66
amount in the account shall be included in the income of the person who receives the67
account.68
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(f) The department shall promulgate any rules and regulations necessary to implement and69
administer the provisions of this Code section."70
SECTION 2.71
This Act shall become effective on July 1, 2025, and shall be applicable to taxable years72
beginning on or after January 1, 2026.73
SECTION 3.74
All laws and parts of laws in conflict with this Act are repealed.75
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