A bill sponsored by U.S. Rep. Dennis Ross (R-FL) would allow individuals to set aside money annually in tax-preferred accounts to use for natural disaster expenses.
Ross’ Disaster Savings Accounts (DSA) Act would establish a new tax-preferred savings account that could be tapped to fortifying residential property in preparation for a natural disaster and rebuilding after one occurs. The funds could be used to build cement-fortified walls, storm shutters, and generators, and repair any damages, for example.
Homeowners can contribute up to $5,000 annually in pre-tax dollars with any balance rolling over at the end of each year.
Further, there is a 20 percent penalty tax on funds withdrawn from a DSA account that is used for purposes other than disaster mitigation expenses.
“One common thread joins us all across the nation, and that is the unexpected risk posed to our families and communities by natural disasters, like we experienced last year with Hurricanes Hermine and Matthew,” Ross said. “My colleagues and I have a duty to the American people to find proactive disaster solutions that work for Floridians and all Americans across the U.S. This is why I am happy to reintroduce my Disaster Savings Accounts (DSA) Act for the 115th Congress. This legislation provides critical relief to Americans in disaster-prone states, allowing them to proactively save pre-tax dollars for use toward disaster preparation and recovery expenses.”
Ross said every dollar spent on mitigation can save up to four dollars in future disaster recovery spending.
“The DSA Act is a common-sense solution that will help keep families and their properties safe, as well as give Americans more control over their money,” he said.