What does Preamble of Universal Savings Account Act of 2025 do?

This bill proposes to amend the Internal Revenue Code of 1986. The stated purpose of the bill is to create Universal Savings Accounts.

What does SHORT TITLE. of Universal Savings Account Act of 2025 do?

This bill is formally titled the Universal Savings Account Act of 2025.

What does UNIVERSAL SAVINGS ACCOUNTS. of Universal Savings Account Act of 2025 do?

This section establishes Universal Savings Accounts (USAs) as exempt from taxation under the Internal Revenue Code. A USA is defined as a trust created in the United States for the exclusive benefit of an individual, designated as such by the Secretary. Contributions to a USA are limited to $10,000, plus an adjustment based on the number of years after 2024, with a maximum limit of $25,000. The trustee must be a bank or another entity demonstrating consistent administration with the requirements of this section. Distributions from a USA are generally not includible in gross income, except for net income attributable to excess contributions. Upon the death of an account holder, the account's treatment depends on whether the surviving spouse acquires it; otherwise, the account ceases to be a USA and amounts are treated as distributed. The amendments apply to taxable years beginning after December 31, 2024.

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Universal Savings Account Act of 2025

Last updated: 5/1/2025 · Introduced: 5/1/2025

Author: Ted Cruz (R-TX)

TL;DR (AI)

This bill establishes Universal Savings Accounts (USAs), a new type of trust, which are exempt from taxation under the Internal Revenue Code.
Individuals can contribute up to $10,000 annually, adjusted for inflation, to a USA, with distributions generally not considered taxable income.
USAs must be administered by a bank or similar entity, and their tax treatment changes upon the account holder's death depending on whether a surviving spouse inherits the account.

119th Congressin committeeHR. 3186(In Committee)Official page

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Other Sections

Includes provisions on preamble, short title., and 1 more.

3 sections

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