READY Accounts Act

Key Points

• The bill creates a new tax-advantaged savings account, called a READY account, so homeowners can set aside up to $4,500 a year and deduct that amount from their taxable income.
• Money in the account grows tax-free and is never taxed when withdrawn, as long as it pays for approved home disaster mitigation or recovery costs, working much like a health savings account.
• Approved uses include hardening measures like impact-resistant windows, reinforced roofs, elevating the home, or ground anchors, plus repair costs from fire or storm damage not covered by insurance.
• Using the money for anything other than approved disaster costs triggers regular income tax plus a 20 percent penalty on that amount.
• The $4,500 contribution limit will rise with inflation each year starting in 2026, and the tax changes would apply to taxable years starting after the end of 2024 if the bill becomes law.