I 

114TH CONGRESS 

1ST SESSION H. R. 2230 

To amend the Internal Revenue Code of 1986 to allow individuals a deduction 

for amounts contributed to disaster savings accounts to help defray 

the cost of preparing their homes to withstand a disaster and to repair 

or replace property damaged or destroyed in a disaster. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 1, 2015 

Mr. ROSS introduced the following bill; which was referred to the Committee 

on Ways and Means 

A BILL 

To amend the Internal Revenue Code of 1986 to allow individuals a deduction for amounts contributed to disaster 

savings accounts to help defray the cost of preparing 

their homes to withstand a disaster and to repair or 

replace property damaged or destroyed in a disaster. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Disaster Savings Ac5 counts Act of 2015’’. 


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1 SEC. 2. DEDUCTION FOR CONTRIBUTIONS TO DISASTER 

2 SAVINGS ACCOUNTS. 

3 (a) IN GENERAL.—Part VII of subchapter B of chap4 ter 1 of the Internal Revenue Code of 1986 (relating to 

5 additional itemized deductions for individuals) is amended 

6 by redesignating section 224 as section 225 and by insert7 ing after section 223 the following new section: 

8 ‘‘SEC. 224. DISASTER SAVINGS ACCOUNTS. 

9 ‘‘(a) DEDUCTION ALLOWED.—In the case of a eligi10 ble individual, there shall be allowed as a deduction for 

11 the taxable year an amount equal to the aggregate amount 

12 paid during such taxable year by or on behalf of such indi13 vidual to a disaster savings account of such individual. 

14 ‘‘(b) LIMITATION.— 

15 ‘‘(1) IN GENERAL.—The amount allowed as a 

16 deduction under subsection (a) to an individual for 

17 the taxable year shall not exceed $5,000. 

18 ‘‘(2) PARTIAL YEAR OF ELIGIBILITY.—In the 

19 case of an individual who is an eligible individual for 

20 only a portion of the taxable year, the limitation 

21 under paragraph (1) shall be same proportion of 

22 $5,000 as such portion bears to the entire taxable 

23 year. 

24 ‘‘(c) ELIGIBLE INDIVIDUAL.—For purposes of this 

25 section, the term ‘eligible individual’ means any individual 


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1 if such individual occupied any residence in the United 

2 States at any time during the taxable year. 

3 ‘‘(d) DISASTER SAVINGS ACCOUNT.—For purposes of 

4 this section— 

5 ‘‘(1) IN GENERAL.—The term ‘disaster savings 

6 account’ means a trust created or organized in the 

7 United States as a disaster savings account exclu8 sively for the purpose of paying the qualified dis9 aster expenses of the account beneficiary, but only 

10 if the written governing instrument creating the 

11 trust meets the following requirements: 

12 ‘‘(A) Except in the case of a rollover con13 tribution described in subsection (f)(5), no con14 tribution will be accepted— 

15 ‘‘(i) unless it is in cash, or 

16 ‘‘(ii) to the extent such contribution, 

17 when added to previous contributions to 

18 the trust for the calendar year, exceeds the 

19 dollar limitation in effect under subsection 

20 (b). 

21 ‘‘(B) The trustee is a bank (as defined in 

22 section 408(n)), an insurance company (as de23 fined in section 816), or another person who 

24 demonstrates to the satisfaction of the Sec25 retary that the manner in which such person 


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1 will administer the trust will be consistent with 

2 the requirements of this section. 

3 ‘‘(C) No part of the trust assets will be in4 vested in life insurance contracts. 

5 ‘‘(D) The assets of the trust will not be 

6 commingled with other property except in a 

7 common trust fund or common investment 

8 fund. 

9 ‘‘(E) The interest of an individual in the 

10 balance in his account is nonforfeitable. 

11 ‘‘(2) QUALIFIED DISASTER EXPENSES.—The 

12 term ‘qualified disaster expenses’ means— 

13 ‘‘(A) disaster mitigation expenses, and 

14 ‘‘(B) disaster recovery expenses. 

15 ‘‘(3) DISASTER MITIGATION EXPENSES.—The 

16 term ‘disaster mitigation expenses’ means expenses 

17 for any of the following with respect to the residence 

18 referred to in subsection (c): 

19 ‘‘(A) Tornado safe rooms manufactured or 

20 constructed in accordance with FEMA 320 or 

21 FEMA 361 guidance or tornado shelters manu22 factured or constructed in accordance with the 

23 National Storm Shelter/International Code 

24 Council 500 standard. 


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1 ‘‘(B) Opening protection, including impact 

2 and wind resistant windows, exterior doors, and 

3 garage doors. 

4 ‘‘(C) Reinforcement of roof-to-wall and 

5 floor-to-wall connections for wind or seismic ac6 tivity. 

7 ‘‘(D) Roof covering for impact, fire, or 

8 high wind resistance. 

9 ‘‘(E) Cripple and shear walls to resist seis10 mic activity. 

11 ‘‘(F) Flood resistant building materials. 

12 ‘‘(G) Elevating structures and utilities 

13 above base flood elevation. 

14 ‘‘(H) Fire resistant exterior wall assem15 blies/systems. 

16 ‘‘(I) Lightning protection systems. 

17 ‘‘(J) Whole home standby generators. 

18 ‘‘(K) Any activity specified by the Sec19 retary as appropriate to mitigate the risks of 

20 future hazards (including earthquake, flood, 

21 hail, hurricane, sinkhole, lightning, power out22 age, tornado, and wildfire) and other natural 

23 disasters. 

24 ‘‘(4) DISASTER RECOVERY EXPENSES.—The 

25 term ‘disaster recovery expenses’ means with respect 


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1 to the residence referred to in subsection (c) any ex2 pense incurred to replace or repair disaster-related 

3 uninsured personal casualty personal losses totaling 

4 $3,000 or greater. 

5 ‘‘(5) DISASTER-RELATED UNINSURED PER6 SONAL CASUALTY LOSS.—The term ‘disaster-related 

7 uninsured personal casualty loss’ means a personal 

8 casualty loss (as defined in section 165(h)(4)(B), de9 termined without regard to the second sentence 

10 thereof) attributable to a State or federally declared 

11 disaster for which a deduction is allowable under 

12 section 165 (without regard to subsection (h)(1)). 

13 ‘‘(6) FEDERALLY DECLARED DISASTER.—The 

14 term ‘federally declared disaster’ has the meaning 

15 given such term by section 165(h)(3)(C). 

16 ‘‘(7) ACCOUNT BENEFICIARY.—The term ‘ac17 count beneficiary’ means the individual on whose be18 half the disaster savings account was established. 

19 ‘‘(e) TREATMENT OF ACCOUNT.— 

20 ‘‘(1) IN GENERAL.—A disaster savings account 

21 is exempt from taxation under this subtitle unless 

22 such account has ceased to be a disaster savings ac23 count. Notwithstanding the preceding sentence, any 

24 such account is subject to the taxes imposed by secVerDate Sep 11 2014 04:05 May 12, 2015 Jkt 049200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H2230.IH H2230

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1 tion 511 (relating to imposition of tax on unrelated 

2 business income of charitable, etc. organizations). 

3 ‘‘(2) ACCOUNT TERMINATIONS.—Rules similar 

4 to the rules of paragraphs (2) and (4) of section 

5 408(e) shall apply to disaster savings accounts, and 

6 any amount treated as distributed under such rules 

7 shall be treated as not used to pay disaster mitiga8 tion expenses. 

9 ‘‘(f) TAX TREATMENT OF DISTRIBUTIONS.— 

10 ‘‘(1) AMOUNTS USED FOR DISASTER MITIGA11 TION EXPENSES.—Any amount paid or distributed 

12 out of a disaster savings account which is used ex13 clusively to pay qualified disaster expenses of any 

14 account beneficiary shall not be includible in gross 

15 income. 

16 ‘‘(2) INCLUSION OF AMOUNTS NOT USED FOR

17 DISASTER MITIGATION EXPENSES.—Any amount 

18 paid or distributed out of a disaster savings account 

19 which is not used exclusively to pay the qualified dis20 aster expenses of the account beneficiary shall be in21 cluded in the gross income of such beneficiary. 

22 ‘‘(3) EXCESS CONTRIBUTIONS RETURNED BE23 FORE DUE DATE OF RETURN.— 

24 ‘‘(A) IN GENERAL.—If any excess con25 tribution is contributed for a taxable year to 


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1 any disaster savings account of an individual, 

2 paragraph (2) shall not apply to distributions 

3 from the disaster savings accounts of such indi4 vidual (to the extent such distributions do not 

5 exceed the aggregate excess contributions to all 

6 such accounts of such individual for such year) 

7 if— 

8 ‘‘(i) such distribution is received by 

9 the individual on or before the last day 

10 prescribed by law (including extensions of 

11 time) for filing such individual’s return for 

12 such taxable year, and 

13 ‘‘(ii) such distribution is accompanied 

14 by the amount of net income attributable 

15 to such excess contribution. 

16 Any net income described in clause (ii) shall be 

17 included in the gross income of the individual 

18 for the taxable year in which it is received. 

19 ‘‘(B) EXCESS CONTRIBUTION.—For pur20 poses of subparagraph (A), the term ‘excess 

21 contribution’ means any contribution (other 

22 than a rollover contribution described in para23 graph (5)) which is not deductible under this 

24 section. 


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1 ‘‘(4) ADDITIONAL TAX ON DISTRIBUTIONS NOT

2 USED FOR DISASTER MITIGATION EXPENSES.— 

3 ‘‘(A) IN GENERAL.—The tax imposed by 

4 this chapter on the account beneficiary for any 

5 taxable year in which there is a payment or dis6 tribution from a disaster savings account of 

7 such beneficiary which is includible in gross in8 come under paragraph (2) shall be increased by 

9 20 percent of the amount which is so includible. 

10 ‘‘(B) EXCEPTION FOR DISABILITY OR

11 DEATH.—Subparagraph (A) shall not apply if 

12 the payment or distribution is made after the 

13 account beneficiary becomes disabled within the 

14 meaning of section 72(m)(7) or dies. 

15 ‘‘(5) ROLLOVER CONTRIBUTION.—An amount is 

16 described in this paragraph as a rollover contribu17 tion if it meets the requirements of subparagraphs 

18 (A) and (B). 

19 ‘‘(A) IN GENERAL.—Paragraph (2) shall 

20 not apply to any amount paid or distributed 

21 from a disaster savings account to the account 

22 beneficiary to the extent the amount received is 

23 paid into a disaster savings account for the ben24 efit of such beneficiary not later than the 60th 


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1 day after the day on which the beneficiary re2 ceives the payment or distribution. 

3 ‘‘(B) LIMITATION.—This paragraph shall 

4 not apply to any amount described in subpara5 graph (A) received by an individual from a dis6 aster savings account if, at any time during the 

7 1-year period ending on the day of such receipt, 

8 such individual received any other amount de9 scribed in subparagraph (A) from a disaster 

10 savings account which was not includible in the 

11 individual’s gross income because of the appli12 cation of this paragraph. 

13 ‘‘(g) COST-OF-LIVING ADJUSTMENT.— 

14 ‘‘(1) IN GENERAL.—In the case of any taxable 

15 year beginning in a calendar year after 2015, each 

16 $5,000 amount in subsection (b) and the $3,000 

17 amount in subsection (d)(4) shall be increased by an 

18 amount equal to— 

19 ‘‘(A) such dollar amount, multiplied by 

20 ‘‘(B) the cost-of-living adjustment deter21 mined under section 1(f)(3) for the calendar 

22 year in which such taxable year begins deter23 mined by substituting ‘calendar year 2014’ for 

24 ‘calendar year 1992’ in subparagraph (B) 

25 thereof. 


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1 ‘‘(2) ROUNDING.—If any increase under para2 graph (1) is not a multiple of $50, such increase 

3 shall be rounded to the nearest multiple of $50. 

4 ‘‘(h) SPECIAL RULES.— 

5 ‘‘(1) DENIAL OF DEDUCTION TO DEPEND6 ENTS.—No deduction shall be allowed under this 

7 section to any individual with respect to whom a de8 duction under section 151 is allowable to another 

9 taxpayer for a taxable year beginning in the cal10 endar year in which such individual’s taxable year 

11 begins. 

12 ‘‘(2) TAXABLE YEAR MUST BE FULL TAXABLE

13 YEAR.—Except in the case of a taxable year closed 

14 by reason of the death of the taxpayer, no deduction 

15 shall be allowed under this section in the case of a 

16 taxable year covering a period of less than 12 

17 months. 

18 ‘‘(3) CERTAIN RULES TO APPLY.—Rules similar 

19 to the following rules shall apply for purposes of this 

20 section: 

21 ‘‘(A) Section 219(d)(2) (relating to no de22 duction for rollovers). 

23 ‘‘(B) Section 219(f)(3) (relating to time 

24 when contributions deemed made). 


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1 ‘‘(C) Section 219(f)(5) (relating to em2 ployer payments). 

3 ‘‘(D) Section 408(g) (relating to commu4 nity property laws). 

5 ‘‘(E) Section 408(h) (relating to custodial 

6 accounts). 

7 ‘‘(F) Section 223(f)(7) (relating to transfer 

8 of account incident to divorce). 

9 ‘‘(G) Section 223(f)(8) (relating to treat10 ment after death of account beneficiary). 

11 ‘‘(4) COORDINATION WITH CASUALTY LOSS DE12 DUCTION.—No deduction shall be allowed under sec13 tion 165 for a loss for which a disaster recovery ex14 pense payment is made from a disaster savings ac15 count. 

16 ‘‘(i) REPORTS.—The Secretary may require the trust17 ee of a disaster savings account to make such reports re18 garding such account to the Secretary and to the account 

19 beneficiary with respect to contributions, distributions, the 

20 return of excess contributions, and such other matters as 

21 the Secretary determines appropriate.’’. 

22 (b) DEDUCTION ALLOWED WHETHER OR NOT INDI23 VIDUAL ITEMIZES OTHER DEDUCTIONS.—Section 62(a) 

24 of such Code is amended by inserting after paragraph (21) 

25 the following new paragraph: 


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1 ‘‘(22) DISASTER SAVINGS ACCOUNTS.—The de2 duction allowed by section 224.’’. 

3 (c) TAX ON EXCESS CONTRIBUTIONS.—Section 4973 

4 of such Code (relating to tax on excess contributions to 

5 certain tax-favored accounts and annuities) is amended— 

6 (1) by striking ‘‘or’’ at the end of subsection 

7 (a)(5), by inserting ‘‘or’’ at the end of subsection 

8 (a)(6), and by inserting after subsection (a)(6) the 

9 following new paragraph: 

10 ‘‘(7) a disaster savings account (within the 

11 meaning of section 224(d)),’’, and 

12 (2) by adding at the end the following new sub13 section: 

14 ‘‘(i) EXCESS CONTRIBUTIONS TO DISASTER SAVINGS

15 ACCOUNTS.—For purposes of this section, in the case of 

16 disaster savings accounts (within the meaning of section 

17 224(d)), the term ‘excess contributions’ means the sum 

18 of— 

19 ‘‘(1) the aggregate amount contributed for the 

20 taxable year to the accounts (other than a rollover 

21 contribution described in section 224(f)(5)) which is 

22 not allowable as a deduction under section 224 for 

23 such year, and 


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1 ‘‘(2) the amount determined under this sub2 section for the preceding taxable year, reduced by 

3 the sum of— 

4 ‘‘(A) the distributions out of the accounts 

5 which were included in gross income under sec6 tion 224(f)(2), and 

7 ‘‘(B) the excess (if any) of— 

8 ‘‘(i) the maximum amount allowable 

9 as a deduction under section 224(b) for 

10 the taxable year, over 

11 ‘‘(ii) the amount contributed to the 

12 accounts for the taxable year. 

13 For purposes of this subsection, any contribu14 tion which is distributed out of the disaster sav15 ings account in a distribution to which section 

16 224(f)(3) applies shall be treated as an amount 

17 not contributed.’’. 

18 (d) FAILURE TO PROVIDE REPORTS ON DISASTER

19 SAVINGS ACCOUNTS.—Section 6693(a)(2) of such Code is 

20 amended by redesignating subparagraphs (D), (E), and 

21 (F) as subparagraphs (E), (F), and (G), respectively, and 

22 by inserting after subparagraph (C) the following new sub23 paragraph: 

24 ‘‘(D) section 224(i) (relating to disaster 

25 savings accounts),’’. 


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1 (e) CLERICAL AMENDMENT.—The table of sections 

2 for part VII of subchapter B of chapter 1 of such Code 

3 is amended by striking the last item and inserting the fol4 lowing: 

‘‘Sec. 224. Disaster savings accounts. 

‘‘Sec. 225. Cross reference.’’. 

5 (f) EFFECTIVE DATE.—The amendments made by 

6 this section shall apply to taxable years beginning after 

7 December 31, 2014. 

Æ 


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