I 
114TH CONGRESS 
1ST SESSION H. R. 4094 
To amend the Internal Revenue Code of 1986 to create Universal Savings 
Accounts. 
IN THE HOUSE OF REPRESENTATIVES 
NOVEMBER 19, 2015 
Mr. BRAT 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 create 
Universal Savings Accounts. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Universal Savings Ac-
count Act’’. 
SEC. 2. UNIVERSAL SAVINGS ACCOUNTS. 
(a) IN GENERAL.—Subchapter F of chapter 1 of the 
Internal Revenue Code of 1986 is amended by adding at 
the end the following new part: 
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‘‘PART IX—UNIVERSAL SAVINGS ACCOUNTS 
‘‘SEC. 530A. UNIVERSAL SAVINGS ACCOUNTS. 
‘‘(a) GENERAL RULE.—A Universal Savings Account 
shall be exempt from taxation under this subtitle. Not-
withstanding the preceding sentence, such account shall 
be subject to the taxes imposed by section 511 (relating 
to imposition of tax on unrelated business income of chari-
table organizations). 
‘‘(b) UNIVERSAL SAVINGS ACCOUNT.—For purposes 
of this section, the term ‘Universal Savings Account’ 
means a trust created or organized in the United States 
by an eligible individual for the exclusive benefit of such 
eligible individual or his beneficiaries and which is des-
ignated (in such manner as the Secretary shall prescribe) 
at the time of the establishment of the trust as a Universal 
Savings Account, but only if the written governing instru-
ment creating the trust meets the following requirements: 
‘‘(1) Except in the case of a qualified rollover 
contribution described in subsection (e)— 
‘‘(A) no contribution will be accepted un-
less it is in cash, and 
‘‘(B) contributions will not be accepted for 
the calendar year in excess of the contribution 
limit specified in subsection (d)(1). 
‘‘(2) The trustee is a bank (as defined in sec-
tion 408(n)) or another person who demonstrates to 
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the satisfaction of the Secretary that the manner in 
which that person will administer the trust will be 
consistent with the requirements of this section or 
who has so demonstrated with respect to any indi-
vidual retirement plan. 
‘‘(3) No part of the trust assets will be invested 
in life insurance contracts. 
‘‘(4) The interest of an individual in the bal-
ance of his account is nonforfeitable. 
‘‘(5) The assets of the trust shall not be com-
mingled with other property except in a common 
trust fund or common investment fund. 
‘‘(c) ELIGIBLE INDIVIDUAL.—For purposes of this 
section, the term ‘eligible individual’ means any individual 
who is— 
‘‘(1) not less than 18 years of age, and 
‘‘(2) a citizen or legal permanent resident of the 
United States. 
‘‘(d) TREATMENT
OF CONTRIBUTIONS
AND DIS-
TRIBUTIONS.— 
‘‘(1) CONTRIBUTION LIMIT.— 
‘‘(A) 
IN
GENERAL.—The 
aggregate 
amount of contributions (other than qualified 
rollover contributions described in subsection 
(e)) for any calendar year to all Universal Sav-
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ings Accounts maintained for the benefit of an 
eligible individual shall not exceed $5,500. 
‘‘(B) COST-OF-LIVING ADJUSTMENT.— 
‘‘(i) IN GENERAL.—In the case of any 
calendar year after 2016, the $5,500 
amount under subparagraph (A) shall be 
increased by an amount equal to— 
‘‘(I) such dollar amount, multi-
plied by 
‘‘(II) the cost-of-living adjust-
ment determined under section 1(f)(3) 
for the calendar year, determined by 
substituting ‘calendar year 2015’ for 
‘calendar year 1992’ in subparagraph 
(B) thereof. 
‘‘(ii) 
ROUNDING
RULES.—If 
any 
amount after adjustment under clause (i) 
is not a multiple of $500, such amount 
shall be rounded to the next lower multiple 
of $500. 
‘‘(2) DISTRIBUTIONS.—Any distribution from a 
Universal Savings Account shall not be includible in 
gross income. 
‘‘(e) QUALIFIED ROLLOVER CONTRIBUTION.—For 
purposes of this section, the term ‘qualified rollover con-
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tribution’ means a contribution to a Universal Savings Ac-
count from another such account of the same beneficiary, 
but only if such amount is contributed not later than the 
60th day after the distribution from such other account. 
‘‘(f) TREATMENT
OF ACCOUNT UPON DEATH.— 
Upon death of any individual for whose benefit a Universal 
Savings Account has been established— 
‘‘(1) all amounts in such account shall be treat-
ed as distributed on the date of such individual’s 
death, and 
‘‘(2) such account shall cease to be treated as 
a Universal Savings Account. 
‘‘(g) LOSS OF TAXATION EXEMPTION OF ACCOUNT 
WHERE BENEFICIARY ENGAGES IN PROHIBITED TRANS-
ACTION; EFFECT
OF PLEDGING ACCOUNT
AS SECU-
RITY.—Rules similar to the rules of paragraphs (2) and 
(4) of section 408(e) shall apply to any Universal Savings 
Account. 
‘‘(h) LIMITATION TO 1 ACCOUNT PER INDIVIDUAL.— 
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), no trust created for the benefit of an eli-
gible individual shall be treated as a Universal Sav-
ings Account under subsection (b) if such eligible in-
dividual has in existence another Universal Savings 
Account at the time such trust was established. 
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‘‘(2) EXCEPTION.—Under regulations estab-
lished by the Secretary, paragraph (1) shall not 
apply with respect to any trust created for the pur-
poses of receiving a qualified rollover contribution 
consisting of all amounts in the previously estab-
lished Universal Savings Account. 
‘‘(i) REPORTS.—The trustee of a Universal Savings 
Account shall make such reports regarding such account 
to the Secretary and to the beneficiary of the account with 
respect to contributions, distributions, and such other 
matters as the Secretary may require. The reports re-
quired by this subsection shall be filed at such time and 
in such manner and furnished to such individuals at such 
time and in such manner as may be required.’’. 
(b) TAX ON EXCESS CONTRIBUTIONS.— 
(1) IN
GENERAL.—Subsection (a) of section 
4973 of the Internal Revenue Code of 1986 is 
amended by striking ‘‘or’’ at the end of paragraph 
(5), by inserting ‘‘or’’ at the end of paragraph (6), 
and by inserting after paragraph (6) the following 
new paragraph: 
‘‘(6) a Universal Savings Account (as defined in 
section 530A),’’. 
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(2) EXCESS CONTRIBUTION.—Section 4973 of 
such Code is amended by adding at the end the fol-
lowing new subsection: 
‘‘(i) EXCESS CONTRIBUTIONS TO UNIVERSAL SAV-
INGS ACCOUNTS.—For purposes of this section— 
‘‘(1) IN GENERAL.—In the case of Universal 
Savings Accounts (within the meaning of section 
530A), the term ‘excess contributions’ means the 
sum of— 
‘‘(A) the amount by which the amount con-
tributed for the calendar year to such accounts 
(other than qualified rollover contributions (as 
defined in section 530A(e))) exceeds the con-
tribution limit under section 530A(d)(1) for 
such calendar year, and 
‘‘(B) the amount determined under this 
subsection for the preceding calendar year, re-
duced by the excess (if any) of the maximum 
amount allowable as a contribution under sec-
tion 530A(d)(1) for the calendar year over the 
amount contributed to the accounts for the cal-
endar year. 
‘‘(2) SPECIAL RULE.—A contribution shall not 
be taken into account under paragraph (1) if such 
contribution (together with the amount of net in-
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come attributable to such contribution) is returned 
to the beneficiary before July 1 of the year following 
the year in which the contribution is made.’’. 
(c) FAILURE TO PROVIDE REPORTS ON UNIVERSAL 
SAVINGS ACCOUNTS.—Paragraph (2) of section 6693(a) 
of the Internal Revenue Code of 1986 is amended by strik-
ing ‘‘and’’ at the end of subparagraph (E), by striking 
the period at the end of subparagraph (F) and inserting 
‘‘, and’’, and by inserting after subparagraph (F) the fol-
lowing new subparagraph: 
‘‘(G) section 530A(i) (relating to Universal 
Savings Accounts).’’. 
(d) CONFORMING AMENDMENT.—The table of parts 
for subchapter F of chapter 1 of the Internal Revenue 
Code of 1986 is amended by adding at the end the fol-
lowing new item: 
‘‘Part IX. Universal Savings Accounts.’’. 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2015. 
Æ 
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