such beneficiary’s gross income for the last 
taxable year of such beneficiary. 
‘‘(f) REPORTS.— 
‘‘(1) IN GENERAL.—The Secretary may require 
the trustee of a Residential Emergency Asset-accu-
mulation Deferred Taxation Yield (READY) account 
to make such reports regarding such account to the 
Secretary and to the account beneficiary with re-
spect to contributions, distributions, the return of 
excess contributions, and such other matters as the 
Secretary determines appropriate. 
‘‘(2) TIME AND MANNER OF REPORTS.—The re-
ports required 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 by the Secretary. 
‘‘(g) REGULATIONS.— The Secretary shall prescribe 
such regulations as may be necessary or appropriate to 
carry out the purposes of this section and to prevent the 
abuse of such purposes.’’. 
(b) EXCESS CONTRIBUTIONS.— 
(1) IN GENERAL.—Section 4973(a) of the In-
ternal Revenue Code of 1986 is amended by striking 
‘‘or’’ at the end of paragraph (5), by inserting ‘‘or’’ 
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at the end of paragraph (6), and by inserting after 
paragraph (6) the following new paragraph: 
‘‘(7) a Residential Emergency Asset-accumula-
tion Deferred Taxation Yield (READY) account 
(within the meaning of section 224),’’. 
(2) EXCESS CONTRIBUTIONS.—Section 4973 of 
such Code is amended by adding at the end the fol-
lowing new subsection: 
‘‘(i) EXCESS
CONTRIBUTIONS
TO
READY AC-
COUNTS.— 
‘‘(1) IN GENERAL.—For purposes of this sec-
tion, in the case of a Residential Emergency Asset- 
accumulation Deferred Taxation Yield (READY) ac-
count (within the meaning of section 224), the term 
‘excess contributions’ means the sum of— 
‘‘(A) the aggregate amount contributed for 
the taxable year to such accounts (other than 
rollover contributions described in section 
224(e)(5)) which is not allowed as a deduction 
under section 224 fo such year, and, and 
‘‘(B) the amount determined under this 
subsection for the preceding taxable year, re-
duced by the sum of— 
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‘‘(i) the distributions out of the ac-
counts which were included in gross in-
come under section 224(e)(2), and 
‘‘(ii) the excess (if any) of the max-
imum amount allowed as a deduction 
under section 224(b) for the taxable year 
over the amount contributed to the ac-
counts for the taxable year. 
‘‘(2) SPECIAL
RULES.—For purposes of this 
subsection, any contribution which is distributed out 
of the Residential Emergency Asset-accumulation 
Deferred Taxation Yield (READY) account in a dis-
tribution to which section 223(e)(3) applies shall be 
treated as an amount not contributed.’’. 
(c) APPLICATION
OF PROHIBITED TRANSACTION 
RULES.— 
(1) IN
GENERAL.—Section 4975(e)(1) of the 
Internal Revenue Code of 1986 is amended by strik-
ing ‘‘or’’ at the end of subparagraph (F), by redesig-
nating subparagraph (G) as subparagraph (H), and 
by inserting after subparagraph (F) the following 
new subparagraph: 
‘‘(G) a Residential Emergency Asset-accu-
mulation Deferred Taxation Yield (READY) ac-
count described in section 224, or’’. 
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(2) SPECIAL RULE.—Section 4975(c) of such 
Code is amended by adding at the end the following 
new paragraph: 
‘‘(8) SPECIAL RULE FOR RESIDENTIAL EMER-
GENCY ASSET-ACCUMULATION DEFERRED TAXATION 
YIELD (READY) ACCOUNTS.—An individual for whose 
benefit a Residential Emergency Asset-accumulation 
Deferred Taxation Yield (READY) account (within 
the meaning of section 224) is established shall be 
exempt from the tax imposed by this section with re-
spect to any transaction concerning such account 
(which would otherwise be taxable under this sec-
tion) if, with respect to such transaction, the ac-
count ceases to be a Residential Emergency Asset- 
accumulation Deferred Taxation Yield (READY) ac-
count by reason of the application of section 
224(d)(2) to such account.’’. 
(d) CONFORMING AMENDMENTS.— 
(1) Section 26(b)(2) of the Internal Revenue 
Code of 1986 is amended by striking ‘‘and’’ at the 
end of subparagraph (Y), by striking the period at 
the end of subparagraph (Z) and inserting ‘‘, and’’, 
and by inserting after subparagraph (Y) the fol-
lowing: 
‘‘(AA) section 224(e)(4).’’. 
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(2) Section 62(a) of such Code is amended by 
inserting after paragraph (21) the following new 
paragraph: 
‘‘(22) RESIDENTIAL EMERGENCY ASSET-ACCU-
MULATION DEFERRED TAXATION YIELD (READY) AC-
COUNT.—The deduction allowed by section 224.’’. 
(3) Section 165(h) of such Code is amended by 
adding at the end the following new paragraph: 
‘‘(6) 
COORDINATION
WITH
EXPENDITURES 
FROM READY ACCOUNTS.—No deduction shall be al-
lowed with respect to any loss described in sub-
section (a)(3) to the extent the taxpayer has made 
an expenditure from a Residential Emergency Asset- 
accumulation Deferred Taxation Yield (READY) ac-
count (as defined in section 224) which is taken into 
account under section 224(c)(2)(C) as a cost with 
respect to such loss.’’. 
(4) Section 877A of such Code is amended— 
(A) in subsection (e)(2) by inserting ‘‘a 
Residential Emergency Asset-accumulation De-
ferred Taxation Yield (READY) account (as de-
fined in section 224),’’ after ‘‘a health savings 
account (as defined in section 223),’’, and 
(B) in subsection (g)(6) by inserting 
‘‘224(e)(4),’’ after ‘‘223(f)(4),’’. 
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(5) Section 6693(a)(2) of such Code is amended 
by striking ‘‘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 following new subparagraph: 
‘‘(G) section 224(f) (relating to Residential 
Emergency Asset-accumulation Deferred Tax-
ation Yield (READY) accounts).’’. 
(6) The table of sections for part VII of sub-
chapter B of chapter 1 of such Code is amended re-
designating the item relating to section 224 as relat-
ing to section 225 and by inserting after the item 
relating to section 223 the following new item: 
‘‘Sec. 224. Residential Emergency Asset-accumulation Deferred Taxation Yield 
(READY) accounts.’’. 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2024. 
Æ 
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