| 1 | 1 | | I |
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| 2 | 2 | | 118THCONGRESS |
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| 3 | 3 | | 1 |
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| 4 | 4 | | STSESSION H. R. 312 |
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| 5 | 5 | | To amend the Internal Revenue Code of 1986 to provide emergency savings |
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| 6 | 6 | | accounts for individuals. |
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| 7 | 7 | | IN THE HOUSE OF REPRESENTATIVES |
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| 8 | 8 | | JANUARY12, 2023 |
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| 9 | 9 | | Mr. C |
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| 10 | 10 | | LOUDintroduced the following bill; which was referred to the Committee |
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| 11 | 11 | | on Ways and Means |
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| 12 | 12 | | A BILL |
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| 13 | 13 | | To amend the Internal Revenue Code of 1986 to provide |
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| 14 | 14 | | emergency savings accounts for individuals. |
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| 15 | 15 | | Be it enacted by the Senate and House of Representa-1 |
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| 16 | 16 | | tives of the United States of America in Congress assembled, 2 |
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| 17 | 17 | | SECTION 1. SHORT TITLE. 3 |
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| 18 | 18 | | This Act may be cited as the ‘‘Emergency Savings 4 |
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| 19 | 19 | | Accounts Act of 2023’’. 5 |
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| 20 | 20 | | SEC. 2. DEDUCTION FOR CONTRIBUTIONS TO EMERGENCY 6 |
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| 21 | 21 | | SAVINGS ACCOUNTS. 7 |
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| 22 | 22 | | (a) I |
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| 23 | 23 | | NGENERAL.—Part VII of subchapter B of chap-8 |
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| 24 | 24 | | ter 1 of the Internal Revenue Code of 1986 (relating to 9 |
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| 25 | 25 | | additional itemized deductions for individuals) is amended 10 |
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| 28 | 28 | | •HR 312 IH |
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| 29 | 29 | | by redesignating section 224 as section 225 and by insert-1 |
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| 30 | 30 | | ing after section 223 the following new section: 2 |
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| 31 | 31 | | ‘‘SEC. 224. EMERGENCY SAVINGS ACCOUNTS. 3 |
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| 32 | 32 | | ‘‘(a) D |
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| 33 | 33 | | EDUCTIONALLOWED.—In the case of a eligi-4 |
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| 34 | 34 | | ble individual, there shall be allowed as a deduction for 5 |
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| 35 | 35 | | the taxable year an amount equal to the aggregate amount 6 |
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| 36 | 36 | | paid during such taxable year by or on behalf of such indi-7 |
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| 37 | 37 | | vidual to an emergency savings account of such individual. 8 |
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| 38 | 38 | | ‘‘(b) L |
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| 39 | 39 | | IMITATION.— 9 |
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| 40 | 40 | | ‘‘(1) I |
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| 41 | 41 | | N GENERAL.—The amount allowed as a 10 |
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| 42 | 42 | | deduction under subsection (a) to an individual for 11 |
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| 43 | 43 | | the taxable year shall not exceed $5,000. 12 |
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| 44 | 44 | | ‘‘(2) P |
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| 45 | 45 | | ARTIAL YEAR OF ELIGIBILITY .—In the 13 |
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| 46 | 46 | | case of an individual who is an eligible individual for 14 |
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| 47 | 47 | | only a portion of the taxable year, the limitation 15 |
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| 48 | 48 | | under paragraph (1) shall be same proportion of 16 |
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| 49 | 49 | | $5,000 as such portion bears to the entire taxable 17 |
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| 50 | 50 | | year. 18 |
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| 51 | 51 | | ‘‘(c) E |
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| 52 | 52 | | LIGIBLEINDIVIDUAL.—For purposes of this 19 |
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| 53 | 53 | | section, the term ‘eligible individual’ means any individual 20 |
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| 54 | 54 | | if such individual occupied any residence in the United 21 |
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| 55 | 55 | | States at any time during the taxable year. 22 |
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| 56 | 56 | | ‘‘(d) E |
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| 57 | 57 | | MERGENCYSAVINGSACCOUNT.—For purposes 23 |
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| 58 | 58 | | of this section— 24 |
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| 62 | 62 | | ‘‘(1) IN GENERAL.—The term ‘emergency sav-1 |
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| 63 | 63 | | ings account’ means a trust created or organized in 2 |
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| 64 | 64 | | the United States as an emergency savings account 3 |
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| 65 | 65 | | exclusively for the purpose of paying the qualified 4 |
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| 66 | 66 | | disaster and public health emergency expenses of the 5 |
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| 67 | 67 | | account beneficiary, but only if the written governing 6 |
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| 68 | 68 | | instrument creating the trust meets the following re-7 |
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| 69 | 69 | | quirements: 8 |
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| 70 | 70 | | ‘‘(A) Except in the case of a rollover con-9 |
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| 71 | 71 | | tribution described in subsection (f)(5), no con-10 |
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| 72 | 72 | | tribution will be accepted— 11 |
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| 73 | 73 | | ‘‘(i) unless it is in cash, or 12 |
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| 74 | 74 | | ‘‘(ii) to the extent such contribution, 13 |
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| 75 | 75 | | when added to previous contributions to 14 |
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| 76 | 76 | | the trust for the calendar year, exceeds the 15 |
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| 77 | 77 | | dollar limitation in effect under subsection 16 |
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| 78 | 78 | | (b). 17 |
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| 79 | 79 | | ‘‘(B) The trustee is a bank (as defined in 18 |
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| 80 | 80 | | section 408(n)), an insurance company (as de-19 |
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| 81 | 81 | | fined in section 816), or another person who 20 |
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| 82 | 82 | | demonstrates to the satisfaction of the Sec-21 |
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| 83 | 83 | | retary that the manner in which such person 22 |
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| 84 | 84 | | will administer the trust will be consistent with 23 |
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| 85 | 85 | | the requirements of this section. 24 |
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| 89 | 89 | | ‘‘(C) No part of the trust assets will be in-1 |
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| 90 | 90 | | vested in life insurance contracts. 2 |
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| 91 | 91 | | ‘‘(D) The assets of the trust will not be 3 |
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| 92 | 92 | | commingled with other property except in a 4 |
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| 93 | 93 | | common trust fund or common investment 5 |
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| 94 | 94 | | fund. 6 |
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| 95 | 95 | | ‘‘(E) The interest of an individual in the 7 |
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| 96 | 96 | | balance in his account is nonforfeitable. 8 |
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| 97 | 97 | | ‘‘(2) Q |
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| 98 | 98 | | UALIFIED DISASTER AND PUBLIC 9 |
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| 99 | 99 | | HEALTH EMERGENCY EXPENSES .—The term ‘quali-10 |
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| 100 | 100 | | fied disaster and public health emergency expenses’ 11 |
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| 101 | 101 | | means— 12 |
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| 102 | 102 | | ‘‘(A) disaster mitigation expenses, 13 |
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| 103 | 103 | | ‘‘(B) disaster recovery expenses, 14 |
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| 104 | 104 | | ‘‘(C) public health emergency expenses, 15 |
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| 105 | 105 | | and 16 |
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| 106 | 106 | | ‘‘(D) unemployment related expenses. 17 |
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| 107 | 107 | | ‘‘(3) D |
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| 108 | 108 | | ISASTER MITIGATION EXPENSES .—The 18 |
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| 109 | 109 | | term ‘disaster mitigation expenses’ means expenses 19 |
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| 110 | 110 | | for any of the following with respect to the residence 20 |
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| 111 | 111 | | referred to in subsection (c): 21 |
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| 112 | 112 | | ‘‘(A) Tornado safe rooms manufactured or 22 |
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| 113 | 113 | | constructed in accordance with FEMA 320 or 23 |
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| 114 | 114 | | FEMA 361 guidance or tornado shelters manu-24 |
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| 115 | 115 | | factured or constructed in accordance with the 25 |
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| 118 | 118 | | •HR 312 IH |
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| 119 | 119 | | National Storm Shelter/International Code 1 |
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| 120 | 120 | | Council 500 standard. 2 |
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| 121 | 121 | | ‘‘(B) Opening protection, including impact 3 |
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| 122 | 122 | | and wind resistant windows, exterior doors, and 4 |
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| 123 | 123 | | garage doors. 5 |
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| 124 | 124 | | ‘‘(C) Reinforcement of roof-to-wall and 6 |
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| 125 | 125 | | floor-to-wall connections for wind or seismic ac-7 |
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| 126 | 126 | | tivity. 8 |
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| 127 | 127 | | ‘‘(D) Roof covering for impact, fire, or 9 |
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| 128 | 128 | | high wind resistance. 10 |
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| 129 | 129 | | ‘‘(E) Cripple and shear walls to resist seis-11 |
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| 130 | 130 | | mic activity. 12 |
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| 131 | 131 | | ‘‘(F) Flood resistant building materials. 13 |
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| 132 | 132 | | ‘‘(G) Elevating structures and utilities 14 |
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| 133 | 133 | | above base flood elevation. 15 |
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| 134 | 134 | | ‘‘(H) Fire resistant exterior wall assem-16 |
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| 135 | 135 | | blies/systems. 17 |
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| 136 | 136 | | ‘‘(I) Lightning protection systems. 18 |
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| 137 | 137 | | ‘‘(J) Whole home standby generators. 19 |
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| 138 | 138 | | ‘‘(K) Any activity specified by the Sec-20 |
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| 139 | 139 | | retary as appropriate to mitigate the risks of 21 |
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| 140 | 140 | | future hazards (including earthquake, flood, 22 |
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| 141 | 141 | | hail, hurricane, sinkhole, lightning, power out-23 |
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| 142 | 142 | | age, tornado, and wildfire) and other natural 24 |
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| 143 | 143 | | disasters. 25 |
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| 146 | 146 | | •HR 312 IH |
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| 147 | 147 | | ‘‘(4) DISASTER RECOVERY EXPENSES .—The 1 |
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| 148 | 148 | | term ‘disaster recovery expenses’ means with respect 2 |
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| 149 | 149 | | to the residence referred to in subsection (c) any ex-3 |
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| 150 | 150 | | pense incurred to replace or repair disaster-related 4 |
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| 151 | 151 | | uninsured personal casualty personal losses totaling 5 |
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| 152 | 152 | | $1,000 or greater. 6 |
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| 153 | 153 | | ‘‘(5) D |
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| 154 | 154 | | ISASTER-RELATED UNINSURED PER -7 |
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| 155 | 155 | | SONAL CASUALTY LOSS .—The term ‘disaster-related 8 |
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| 156 | 156 | | uninsured personal casualty loss’ means a personal 9 |
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| 157 | 157 | | casualty loss (as defined in section 165(h)(3)(B), de-10 |
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| 158 | 158 | | termined without regard to the second sentence 11 |
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| 159 | 159 | | thereof) attributable to a State or federally declared 12 |
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| 160 | 160 | | disaster for which a deduction is allowable under 13 |
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| 161 | 161 | | section 165 (without regard to subsection (h)(1)). 14 |
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| 162 | 162 | | ‘‘(6) F |
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| 163 | 163 | | EDERALLY DECLARED DISASTER .—The 15 |
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| 164 | 164 | | term ‘federally declared disaster’ has the meaning 16 |
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| 165 | 165 | | given such term by section 165(i)(5). 17 |
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| 166 | 166 | | ‘‘(7) P |
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| 167 | 167 | | UBLIC HEALTH EMERGENCY EX -18 |
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| 168 | 168 | | PENSES.—The term ‘public health emergency ex-19 |
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| 169 | 169 | | penses’ means expenses for any of the following with 20 |
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| 170 | 170 | | respect to an individual referred to in subsection (c) 21 |
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| 171 | 171 | | if paid or incurred while a public health emergency 22 |
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| 172 | 172 | | declaration is in effect and while such individual is 23 |
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| 173 | 173 | | unemployed or has their employment status reduced 24 |
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| 174 | 174 | | from full-time status: 25 |
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| 177 | 177 | | •HR 312 IH |
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| 178 | 178 | | ‘‘(A) Child care expenses. 1 |
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| 179 | 179 | | ‘‘(B) Out-of-pocket health care costs, in-2 |
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| 180 | 180 | | cluding insurance premiums. 3 |
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| 181 | 181 | | ‘‘(C) Housing expenses including mort-4 |
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| 182 | 182 | | gage, rent, or property taxes. 5 |
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| 183 | 183 | | ‘‘(D) Utilities. 6 |
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| 184 | 184 | | ‘‘(8) P |
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| 185 | 185 | | UBLIC HEALTH EMERGENCY DECLARA -7 |
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| 186 | 186 | | TION.—The term ‘public health emergency declara-8 |
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| 187 | 187 | | tion’ means any declaration of a public health emer-9 |
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| 188 | 188 | | gency by the Secretary of Health and Human Serv-10 |
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| 189 | 189 | | ices under section 319 of the Public Health Service 11 |
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| 190 | 190 | | Act (42 U.S.C. 247d). 12 |
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| 191 | 191 | | ‘‘(9) U |
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| 192 | 192 | | NEMPLOYMENT RELATED EXPENSES .— 13 |
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| 193 | 193 | | The term ‘unemployment related expenses’ means, in 14 |
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| 194 | 194 | | the case of an account beneficiary with any period 15 |
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| 195 | 195 | | of unemployment during the taxable year, any ex-16 |
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| 196 | 196 | | penses during such taxable year which, in the aggre-17 |
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| 197 | 197 | | gate, do not exceed $500. 18 |
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| 198 | 198 | | ‘‘(10) A |
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| 199 | 199 | | CCOUNT BENEFICIARY .—The term ‘ac-19 |
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| 200 | 200 | | count beneficiary’ means the individual on whose be-20 |
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| 201 | 201 | | half the emergency savings account was established. 21 |
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| 202 | 202 | | ‘‘(e) T |
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| 203 | 203 | | REATMENT OFACCOUNT.— 22 |
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| 204 | 204 | | ‘‘(1) I |
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| 205 | 205 | | N GENERAL.—An emergency savings ac-23 |
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| 206 | 206 | | count is exempt from taxation under this subtitle 24 |
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| 207 | 207 | | unless such account has ceased to be an emergency 25 |
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| 210 | 210 | | •HR 312 IH |
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| 211 | 211 | | savings account. Notwithstanding the preceding sen-1 |
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| 212 | 212 | | tence, any such account is subject to the taxes im-2 |
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| 213 | 213 | | posed by section 511 (relating to imposition of tax 3 |
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| 214 | 214 | | on unrelated business income of charitable, etc. or-4 |
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| 215 | 215 | | ganizations). 5 |
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| 216 | 216 | | ‘‘(2) A |
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| 217 | 217 | | CCOUNT TERMINATIONS .—Rules similar 6 |
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| 218 | 218 | | to the rules of paragraphs (2) and (4) of section 7 |
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| 219 | 219 | | 408(e) shall apply to emergency savings accounts, 8 |
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| 220 | 220 | | and any amount treated as distributed under such 9 |
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| 221 | 221 | | rules shall be treated as not used to pay qualified 10 |
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| 222 | 222 | | disaster and public health emergency expenses. 11 |
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| 223 | 223 | | ‘‘(f) T |
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| 224 | 224 | | AXTREATMENT OFDISTRIBUTIONS.— 12 |
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| 225 | 225 | | ‘‘(1) A |
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| 226 | 226 | | MOUNTS USED FOR QUALIFIED DISASTER 13 |
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| 227 | 227 | | AND PUBLIC HEALTH EMERGENCY EXPENSES .—Any 14 |
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| 228 | 228 | | amount paid or distributed out of an emergency sav-15 |
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| 229 | 229 | | ings account which is used exclusively to pay quali-16 |
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| 230 | 230 | | fied disaster and public health emergency expenses 17 |
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| 231 | 231 | | of any account beneficiary shall not be includible in 18 |
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| 232 | 232 | | gross income. 19 |
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| 233 | 233 | | ‘‘(2) I |
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| 234 | 234 | | NCLUSION OF AMOUNTS NOT USED FOR 20 |
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| 235 | 235 | | QUALIFIED DISASTER AND PUBLIC HEALTH EMER -21 |
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| 236 | 236 | | GENCY EXPENSES.—Any amount paid or distributed 22 |
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| 237 | 237 | | out of an emergency savings account which is not 23 |
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| 238 | 238 | | used exclusively to pay the qualified disaster and 24 |
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| 239 | 239 | | public health emergency expenses of the account 25 |
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| 243 | 243 | | beneficiary shall be included in the gross income of 1 |
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| 244 | 244 | | such beneficiary. 2 |
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| 245 | 245 | | ‘‘(3) E |
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| 246 | 246 | | XCESS CONTRIBUTIONS RETURNED BE -3 |
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| 247 | 247 | | FORE DUE DATE OF RETURN .— 4 |
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| 248 | 248 | | ‘‘(A) I |
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| 249 | 249 | | N GENERAL.—If any excess con-5 |
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| 250 | 250 | | tribution is contributed for a taxable year to 6 |
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| 251 | 251 | | any emergency savings account of an individual, 7 |
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| 252 | 252 | | paragraph (2) shall not apply to distributions 8 |
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| 253 | 253 | | from the emergency savings accounts of such 9 |
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| 254 | 254 | | individual (to the extent such distributions do 10 |
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| 255 | 255 | | not exceed the aggregate excess contributions to 11 |
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| 256 | 256 | | all such accounts of such individual for such 12 |
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| 257 | 257 | | year) if— 13 |
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| 258 | 258 | | ‘‘(i) such distribution is received by 14 |
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| 259 | 259 | | the individual on or before the last day 15 |
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| 260 | 260 | | prescribed by law (including extensions of 16 |
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| 261 | 261 | | time) for filing such individual’s return for 17 |
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| 262 | 262 | | such taxable year, and 18 |
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| 263 | 263 | | ‘‘(ii) such distribution is accompanied 19 |
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| 264 | 264 | | by the amount of net income attributable 20 |
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| 265 | 265 | | to such excess contribution. 21 |
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| 266 | 266 | | Any net income described in clause (ii) shall be 22 |
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| 267 | 267 | | included in the gross income of the individual 23 |
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| 268 | 268 | | for the taxable year in which it is received. 24 |
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| 271 | 271 | | •HR 312 IH |
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| 272 | 272 | | ‘‘(B) EXCESS CONTRIBUTION .—For pur-1 |
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| 273 | 273 | | poses of subparagraph (A), the term ‘excess 2 |
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| 274 | 274 | | contribution’ means any contribution (other 3 |
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| 275 | 275 | | than a rollover contribution described in para-4 |
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| 276 | 276 | | graph (5)) which is not deductible under this 5 |
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| 277 | 277 | | section. 6 |
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| 278 | 278 | | ‘‘(4) A |
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| 279 | 279 | | DDITIONAL TAX ON DISTRIBUTIONS NOT 7 |
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| 280 | 280 | | USED FOR QUALIFIED DISASTER AND PUBLIC 8 |
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| 281 | 281 | | HEALTH EMERGENCY EXPENSES .— 9 |
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| 282 | 282 | | ‘‘(A) I |
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| 283 | 283 | | N GENERAL.—The tax imposed by 10 |
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| 284 | 284 | | this chapter on the account beneficiary for any 11 |
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| 285 | 285 | | taxable year in which there is a payment or dis-12 |
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| 286 | 286 | | tribution from an emergency savings account of 13 |
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| 287 | 287 | | such beneficiary which is includible in gross in-14 |
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| 288 | 288 | | come under paragraph (2) shall be increased by 15 |
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| 289 | 289 | | 20 percent of the amount which is so includible. 16 |
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| 290 | 290 | | ‘‘(B) E |
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| 291 | 291 | | XCEPTION FOR DISABILITY OR 17 |
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| 292 | 292 | | DEATH.—Subparagraph (A) shall not apply if 18 |
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| 293 | 293 | | the payment or distribution is made after the 19 |
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| 294 | 294 | | account beneficiary becomes disabled within the 20 |
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| 295 | 295 | | meaning of section 72(m)(7) or dies. 21 |
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| 296 | 296 | | ‘‘(5) R |
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| 297 | 297 | | OLLOVER CONTRIBUTION .—An amount is 22 |
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| 298 | 298 | | described in this paragraph as a rollover contribu-23 |
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| 299 | 299 | | tion if it meets the requirements of subparagraphs 24 |
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| 300 | 300 | | (A) and (B). 25 |
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| 304 | 304 | | ‘‘(A) IN GENERAL.—Paragraph (2) shall 1 |
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| 305 | 305 | | not apply to any amount paid or distributed 2 |
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| 306 | 306 | | from an emergency savings account to the ac-3 |
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| 307 | 307 | | count beneficiary to the extent the amount re-4 |
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| 308 | 308 | | ceived is paid into an emergency savings ac-5 |
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| 309 | 309 | | count for the benefit of such beneficiary not 6 |
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| 310 | 310 | | later than the 60th day after the day on which 7 |
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| 311 | 311 | | the beneficiary receives the payment or distribu-8 |
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| 312 | 312 | | tion. 9 |
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| 313 | 313 | | ‘‘(B) L |
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| 314 | 314 | | IMITATION.—This paragraph shall 10 |
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| 315 | 315 | | not apply to any amount described in subpara-11 |
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| 316 | 316 | | graph (A) received by an individual from an 12 |
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| 317 | 317 | | emergency savings account if, at any time dur-13 |
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| 318 | 318 | | ing the 1-year period ending on the day of such 14 |
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| 319 | 319 | | receipt, such individual received any other 15 |
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| 320 | 320 | | amount described in subparagraph (A) from an 16 |
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| 321 | 321 | | emergency savings account which was not in-17 |
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| 322 | 322 | | cludible in the individual’s gross income because 18 |
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| 323 | 323 | | of the application of this paragraph. 19 |
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| 324 | 324 | | ‘‘(g) C |
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| 325 | 325 | | OST-OF-LIVINGADJUSTMENT.— 20 |
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| 326 | 326 | | ‘‘(1) I |
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| 327 | 327 | | N GENERAL.—In the case of any taxable 21 |
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| 328 | 328 | | year beginning in a calendar year after 2023, each 22 |
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| 329 | 329 | | $5,000 amount in subsection (b) and the $3,000 23 |
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| 330 | 330 | | amount in subsection (d)(4) shall be increased by an 24 |
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| 331 | 331 | | amount equal to— 25 |
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| 335 | 335 | | ‘‘(A) such dollar amount, multiplied by 1 |
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| 336 | 336 | | ‘‘(B) the cost-of-living adjustment deter-2 |
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| 337 | 337 | | mined under section 1(f)(3) for the calendar 3 |
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| 338 | 338 | | year in which such taxable year begins deter-4 |
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| 339 | 339 | | mined by substituting ‘calendar year 2022’ for 5 |
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| 340 | 340 | | ‘calendar year 2016’ in subparagraph (A)(ii) 6 |
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| 341 | 341 | | thereof. 7 |
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| 342 | 342 | | ‘‘(2) R |
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| 343 | 343 | | OUNDING.—If any increase under para-8 |
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| 344 | 344 | | graph (1) is not a multiple of $50, such increase 9 |
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| 345 | 345 | | shall be rounded to the nearest multiple of $50. 10 |
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| 346 | 346 | | ‘‘(h) S |
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| 347 | 347 | | PECIALRULES.— 11 |
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| 348 | 348 | | ‘‘(1) D |
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| 349 | 349 | | ENIAL OF DEDUCTION TO DEPEND -12 |
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| 350 | 350 | | ENTS.—No deduction shall be allowed under this 13 |
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| 351 | 351 | | section to any individual with respect to whom a de-14 |
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| 352 | 352 | | duction under section 151 is allowable to another 15 |
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| 353 | 353 | | taxpayer for a taxable year beginning in the cal-16 |
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| 354 | 354 | | endar year in which such individual’s taxable year 17 |
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| 355 | 355 | | begins. 18 |
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| 356 | 356 | | ‘‘(2) T |
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| 357 | 357 | | AXABLE YEAR MUST BE FULL TAXABLE 19 |
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| 358 | 358 | | YEAR.—Except in the case of a taxable year closed 20 |
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| 359 | 359 | | by reason of the death of the taxpayer, no deduction 21 |
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| 360 | 360 | | shall be allowed under this section in the case of a 22 |
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| 361 | 361 | | taxable year covering a period of less than 12 23 |
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| 362 | 362 | | months. 24 |
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| 365 | 365 | | •HR 312 IH |
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| 366 | 366 | | ‘‘(3) CERTAIN RULES TO APPLY .—Rules similar 1 |
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| 367 | 367 | | to the following rules shall apply for purposes of this 2 |
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| 368 | 368 | | section: 3 |
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| 369 | 369 | | ‘‘(A) Section 219(d)(2) (relating to no de-4 |
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| 370 | 370 | | duction for rollovers). 5 |
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| 371 | 371 | | ‘‘(B) Section 219(f)(3) (relating to time 6 |
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| 372 | 372 | | when contributions deemed made). 7 |
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| 373 | 373 | | ‘‘(C) Section 219(f)(5) (relating to em-8 |
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| 374 | 374 | | ployer payments). 9 |
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| 375 | 375 | | ‘‘(D) Section 408(g) (relating to commu-10 |
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| 376 | 376 | | nity property laws). 11 |
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| 377 | 377 | | ‘‘(E) Section 408(h) (relating to custodial 12 |
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| 378 | 378 | | accounts). 13 |
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| 379 | 379 | | ‘‘(F) Section 223(f)(7) (relating to transfer 14 |
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| 380 | 380 | | of account incident to divorce). 15 |
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| 381 | 381 | | ‘‘(G) Section 223(f)(8) (relating to treat-16 |
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| 382 | 382 | | ment after death of account beneficiary). 17 |
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| 383 | 383 | | ‘‘(4) C |
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| 384 | 384 | | OORDINATION WITH CASUALTY LOSS DE -18 |
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| 385 | 385 | | DUCTION.—No deduction shall be allowed under sec-19 |
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| 386 | 386 | | tion 165 for a loss for which a disaster recovery ex-20 |
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| 387 | 387 | | pense payment is made from an emergency savings 21 |
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| 388 | 388 | | account. 22 |
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| 389 | 389 | | ‘‘(i) R |
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| 390 | 390 | | EPORTS.—The Secretary may require the trust-23 |
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| 391 | 391 | | ee of an emergency savings account to make such reports 24 |
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| 392 | 392 | | regarding such account to the Secretary and to the ac-25 |
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| 395 | 395 | | •HR 312 IH |
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| 396 | 396 | | count beneficiary with respect to contributions, distribu-1 |
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| 397 | 397 | | tions, the return of excess contributions, and such other 2 |
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| 398 | 398 | | matters as the Secretary determines appropriate.’’. 3 |
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| 399 | 399 | | (b) D |
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| 400 | 400 | | EDUCTIONALLOWEDWHETHER ORNOTINDI-4 |
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| 401 | 401 | | VIDUALITEMIZESOTHERDEDUCTIONS.—Section 62(a) 5 |
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| 402 | 402 | | of such Code is amended by inserting after paragraph (21) 6 |
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| 403 | 403 | | the following new paragraph: 7 |
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| 404 | 404 | | ‘‘(22) E |
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| 405 | 405 | | MERGENCY SAVINGS ACCOUNTS .—The 8 |
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| 406 | 406 | | deduction allowed by section 224.’’. 9 |
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| 407 | 407 | | (c) T |
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| 408 | 408 | | AX ONEXCESSCONTRIBUTIONS.—Section 4973 10 |
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| 409 | 409 | | of such Code (relating to tax on excess contributions to 11 |
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| 410 | 410 | | certain tax-favored accounts and annuities) is amended— 12 |
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| 411 | 411 | | (1) by striking ‘‘or’’ at the end of subsection 13 |
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| 412 | 412 | | (a)(5), by inserting ‘‘or’’ at the end of subsection 14 |
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| 413 | 413 | | (a)(6), and by inserting after subsection (a)(6) the 15 |
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| 414 | 414 | | following new paragraph: 16 |
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| 415 | 415 | | ‘‘(7) an emergency savings account (within the 17 |
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| 416 | 416 | | meaning of section 224(d)),’’; and 18 |
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| 417 | 417 | | (2) by adding at the end the following new sub-19 |
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| 418 | 418 | | section: 20 |
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| 419 | 419 | | ‘‘(i) E |
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| 420 | 420 | | XCESSCONTRIBUTIONS TO EMERGENCYSAV-21 |
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| 421 | 421 | | INGSACCOUNTS.—For purposes of this section, in the 22 |
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| 422 | 422 | | case of emergency savings accounts (within the meaning 23 |
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| 423 | 423 | | of section 224(d)), the term ‘excess contributions’ means 24 |
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| 424 | 424 | | the sum of— 25 |
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| 427 | 427 | | •HR 312 IH |
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| 428 | 428 | | ‘‘(1) the aggregate amount contributed for the 1 |
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| 429 | 429 | | taxable year to the accounts (other than a rollover 2 |
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| 430 | 430 | | contribution described in section 224(f)(5)) which is 3 |
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| 431 | 431 | | not allowable as a deduction under section 224 for 4 |
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| 432 | 432 | | such year, and 5 |
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| 433 | 433 | | ‘‘(2) the amount determined under this sub-6 |
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| 434 | 434 | | section for the preceding taxable year, reduced by 7 |
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| 435 | 435 | | the sum of— 8 |
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| 436 | 436 | | ‘‘(A) the distributions out of the accounts 9 |
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| 437 | 437 | | which were included in gross income under sec-10 |
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| 438 | 438 | | tion 224(f)(2), and 11 |
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| 439 | 439 | | ‘‘(B) the excess (if any) of— 12 |
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| 440 | 440 | | ‘‘(i) the maximum amount allowable 13 |
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| 441 | 441 | | as a deduction under section 224(b) for 14 |
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| 442 | 442 | | the taxable year, over 15 |
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| 443 | 443 | | ‘‘(ii) the amount contributed to the 16 |
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| 444 | 444 | | accounts for the taxable year. 17 |
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| 445 | 445 | | For purposes of this subsection, any contribu-18 |
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| 446 | 446 | | tion which is distributed out of the emergency 19 |
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| 447 | 447 | | savings account in a distribution to which sec-20 |
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| 448 | 448 | | tion 224(f)(3) applies shall be treated as an 21 |
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| 449 | 449 | | amount not contributed.’’. 22 |
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| 450 | 450 | | (d) F |
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| 451 | 451 | | AILURETOPROVIDEREPORTS ONEMERGENCY 23 |
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| 452 | 452 | | S |
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| 453 | 453 | | AVINGSACCOUNTS.—Section 6693(a)(2) of such Code is 24 |
|---|
| 454 | 454 | | amended by redesignating subparagraphs (D), (E), and 25 |
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| 457 | 457 | | •HR 312 IH |
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| 458 | 458 | | (F) as subparagraphs (E), (F), and (G), respectively, and 1 |
|---|
| 459 | 459 | | by inserting after subparagraph (C) the following new sub-2 |
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| 460 | 460 | | paragraph: 3 |
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| 461 | 461 | | ‘‘(D) section 224(i) (relating to emergency 4 |
|---|
| 462 | 462 | | savings accounts),’’. 5 |
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| 463 | 463 | | (e) C |
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| 464 | 464 | | LERICALAMENDMENT.—The table of sections 6 |
|---|
| 465 | 465 | | for part VII of subchapter B of chapter 1 of such Code 7 |
|---|
| 466 | 466 | | is amended by striking the last item and inserting the fol-8 |
|---|
| 467 | 467 | | lowing: 9 |
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| 468 | 468 | | ‘‘Sec. 224. Emergency savings accounts. |
|---|
| 469 | 469 | | ‘‘Sec. 225. Cross reference.’’. |
|---|
| 470 | 470 | | (f) EFFECTIVEDATE.—The amendments made by 10 |
|---|
| 471 | 471 | | this section shall apply to taxable years beginning after 11 |
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| 472 | 472 | | December 31, 2022. 12 |
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| 473 | 473 | | Æ |
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