YourVoice.Now Summary
Your MoneyA new savings account anyone could open — up to $10,000 a year, tax-free growth, and withdrawals for any reason.
Your Money
The account would be free of federal income tax, so interest and gains inside it would not be taxed. The bill gives no deduction for money you put in — the break is on what the money earns.
The $10,000 limit for 2025 would grow by $500 in each later year, and inflation would raise it further starting in 2026. It could not pass $25,000, though that ceiling would rise with inflation too.
Money taken out would not count as income on your federal return, at any age and for any purpose. There is no rule tying the account to school, health care, or retirement.
More about this bill
A new kind of savings account would let your money grow without federal tax. You could put in up to $10,000 for 2025. That limit would rise by $500 each year, plus inflation, until it hits $25,000. The bill sets no income limit on who may open one. You could take money out at any time, for any reason, and owe no federal income tax on it. Other tax-favored accounts, like a 529 plan, tie the break to a set use. The bill gives no deduction for money you put in. The break is on what the money earns. Put in more than the limit and a 6 percent tax would hit the excess each year until you take it back out. The rules would cover tax years that start after December 31, 2024.
Congressional Summary
Universal Savings Account Act of 2025This bill establishes Universal Savings Accounts, which are tax-advantaged savings accounts that allow contributions up to a certain amount, exempt earnings and distributions from federal income taxes, and allow distributions to be used for any purpose. (Conditions and exceptions apply.)Specifically, the bill allows cash contributions to a Universal Savings Account of up to $10,000 in 2025 (maximum base contribution), excluding qualified amounts rolled over from another tax-advantaged account (e.g., individual retirement account). The maximum base contribution amount is increased by $500 each year beginning in 2026 and adjusted annually for inflation, up to a total maximum contribution of $25,000 (also adjusted annually for inflation beginning in 2026).Under the bill, earnings and distributions from a Universal Savings Account are excluded from gross income for federal tax purposes and, thus, are not subject to federal income taxes (similar to the federal tax treatment of distributions from a Roth individual retirement account). (Some exceptions apply.)Further, distributions from such accounts are not restricted and may be used for any purpose (unlike other types of tax-advantaged accounts currently available).The bill also imposes a federal excise tax on contributions to a Universal Savings Account in excess of the applicable contribution limit,a federal excise tax on certain transactions involving a Universal Savings Account and disqualified persons,certain reporting requirements on Universal Savings Account trustees, anda federal excise tax for failing to meet such reporting requirements.
Details
- Congress
- 119th
- Chamber
- House
- Status
- summarized
- Action
- Introduced in House
- Action Date
- 2025-05-05
- Date Added
- 2026-09-01
- Source
- Congress.gov →
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