U.S. Rep. Ross and U.S. Sen. Inhofe Introduce Disaster Savings Accounts Bill
Bill Will Give Families More Control of Their Money to Protect Themselves and Their Property in the Event of a Natural Disaster
U.S. Rep. Dennis Ross (FL-15) and U.S. Sen. Jim Inhofe (R-Okla.) introduced The Disaster Savings Accounts (DSA) Act in their respective chambers. This bill would establish a new tax-preferred savings account for the purpose of fortifying a residence property (i.e. house, condo, apartment) in preparation for an impending natural disaster and, in the aftermath, for rebuilding and damage expenses. A homeowner could contribute up to $5,000 annually in pre-tax dollars to be used for DSA-qualified expenses and the balance would roll over at the end of each year.
In addition to the traditional expenses associated with disaster mitigation and repair of a residence, the DSA account will allow homeowners to utilize DSA funds for uninsured personal casualty losses for the home. This will help mitigate, and even avoid altogether, insurance premium increases for instances where the availability of DSA funds for smaller-value damage would allow the homeowner to avoid tapping into insurance coverage for damage repair.
The following groups support the Ross-Inhofe Disaster Savings Accounts Act:
Lowe’s Home Improvement
The Home Depot
FLASH (Federal Alliance for Safe Homes)
Reinsurance Association of America
National Association of Home Builders
The Nature Conservancy
American Insurance Association (Added 2/6/2014)
National Association of Insurance Commissioners (Added 2/20/2014)
“One common thread joins all of us across the nation and that’s the unexpected risk posed to our families and communities when a natural disaster strikes,” said Ross. “As Representatives elected by the people, my Senate and House colleagues and I have a duty and obligation to find proactive solutions that work for the people here in Florida and all over the U.S., which is why I’m happy to join with Senator Jim Inhofe of Oklahoma in introducing the Disaster Savings Accounts (DSA) Act of 2014. This legislation provides critical relief to Americans in disaster-prone states, allowing them to save pre-tax money for use toward disaster preparation and recovery expenses. Ultimately, this type of saving will reduce future federal costs to taxpayers since every dollar spent on mitigation can save up to four dollars in future disaster recovery spending. It’s important that we incentivize Americans to build a safety net in the event of personal catastrophic losses from high-cost disasters like floods, hurricanes, and tornadoes. The DSA Act is a common-sense, proactive solution that will help keep families safe, their property protected and will give Floridians and all Americans more control of their money.”
Florida State Representative Dan Raulerson who represents Plant City: “I commend Congressman Ross on his innovative approach to solving what has become a financial difficulty for many taxpayers. This approach values personal and financial responsibility in the spirit of our American culture and is far less costly to the Federal Government/taxpayers than would be future bail-outs of ill-advised government programs.”
“This innovative policy will provide United States citizens a financially advantageous way to enhance home resilience before or after disasters strike,” said Federal Alliance for Safe Homes (FLASH) President and CEO Leslie Chapman-Henderson. “We support this legislation and the smart yet simple approach of tax relief as a proven method to empower and reward families who build and prepare their homes with Mother Nature in mind.”
“Every year many Americans face unexpected financial tolls and personal losses from natural disasters, of which Oklahomans experienced some of the harshest last year when tornadoes devastated portions of our state," said Inhofe. "Whether it's a retirement or health savings account, Americans understand the importance of preparing and setting aside funds for the future and these accounts have long been incentivized with federal tax relief. The DSA Act is a common-sense solution to help mitigate the costly impacts of natural disasters by affording homeowners the opportunity to set aside $5,000 a year in a tax-preferred account for disaster prevention or revitalization. It empowers Americans to take their security into their own hands instead of waiting for an unknown period of time for government assistance or for a costly insurance premium to kick in. I’m proud to introduce the DSA Act with Congressman Ross to give those in disaster-prone areas better means to prepare for catastrophic weather or begin the road to rebuilding."
-The bill numbers for the Ross-Inhofe bill: H.R. 3989 and S. 1991.
-This bill is an updated version of H.R. 3298 The Disaster Savings Accounts Act of 2013 introduced by Rep. Ross October 2013.
-The Ross-Inhofe Disaster Savings Accounts Act utilizes currently existing IRS Code language regarding transfer of DSA Account to next of kin under extenuating circumstances (i.e. death, incapacitation of account holder).
-The Ross-Inhofe Disaster Savings Accounts Act protects against duplicate income exclusion in claiming annual tax deductions for expenses incurred.
*The coalition members of SmarterSafer.org are: American Rivers; Center for Climate and Energy Solutions (C2ES); Ceres; ConservAmerica; Defenders of Wildlife; Natural Resources Defense Council; National Wildlife Federation; Sierra Club; The Nature Conservancy; National Taxpayers Union; Taxpayers for Common Sense; Allianz of America; Association of Bermuda Insurers and Reinsurers; The Chubb Corporation; Liberty Mutual Group; National Fire Protection Association; National Housing Conference; National Leased Housing Association; American Consumer Institute; Association of Floodplain Managers; National Association of Mutual Insurance Companies (NAMIC); National Flood Determination Association; SwissRe; USAA; Natural Hazard Mitigation Association; Center for Clean Air Policy; Friends of the Earth; Institute for Liberty; Union of Concerned Scientists; and Zurich.