119-s586

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 586 Introduced in Senate

    (IS) ]

<DOC>

119th CONGRESS
 1st Session
 S. 586

 To amend the Internal Revenue Code of 1986 to provide an advance 
 refundable credit to offset certain flood insurance premiums, and for 
 other purposes.

_______________________________________________________________________

 IN THE SENATE OF THE UNITED STATES

 February 13, 2025

Mr. Cassidy (for himself and Mr. Booker) introduced the following bill; 
 which was read twice and referred to the Committee on Finance

_______________________________________________________________________

 A BILL

 To amend the Internal Revenue Code of 1986 to provide an advance 
 refundable credit to offset certain flood insurance premiums, and for 
 other purposes.

 Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

 This Act may be cited as the ``Flood Insurance Affordability Tax 
Credit Act''.

SEC. 2. REFUNDABLE CREDIT FOR CERTAIN FLOOD INSURANCE COVERAGE.

    (a) In General.--Subpart C of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 is amended by inserting after 

section 36B the following new section:

``

SEC. 36C. REFUNDABLE CREDIT FOR CERTAIN FLOOD INSURANCE COVERAGE.

 ``

    (a) In General.--There shall be allowed as a credit against the 
tax imposed by this subtitle for any taxable year an amount equal to 33 
percent of the applicable flood insurance premiums paid or incurred by 
the taxpayer during the taxable year.
 ``

    (b) Limitation Based on Household Income.--
 ``

    (1) In general.--The amount of the credit allowed under 
 subsection

    (a) (determined without regard to this subsection) 
 shall be reduced (but not below zero) by the amount which bears 
 the same ratio to such credit as--
 ``
        (A) the excess (if any) of--
 ``
            (i) the taxpayer's household income for 
 such taxable year, over
 ``
            (ii) an amount equal to 350 percent of 
 the poverty line for a family of the size 
 involved, bears to
 ``
        (B) the phaseout amount.
 ``

    (2) Phaseout amount.--For purposes of this subsection, 
 the phaseout amount with respect to any taxpayer for any 
 taxable year is the excess of--
 ``
        (A) an amount equal to 435 percent of the poverty 
 line for a family of the size involved, over
 ``
        (B) an amount equal to 350 percent of the poverty 
 line for a family of the size involved.
 ``

    (3) Terms related to income and families.--Rules similar 
 to the rules of 

section 36B
            (d) shall apply for purposes of 
 determining family size, household income, and the poverty 
 line.
 ``
            (c) Applicable Flood Insurance Premiums.--For purposes of this 
section, the term `applicable flood insurance premiums' means premiums 
paid or incurred to insure the principal residence (within the meaning 
of 

section 121) of the taxpayer under the program established under the 
National Flood Insurance Act of 1968 (42 U.S.C. 4001 et seq.).
 ``
            (d) Other Rules.--
 ``

    (1) No credit for married individuals filing separate 
 returns.--If the taxpayer is a married individual (within the 
 meaning of 

section 7703), this section shall apply only if the 
 taxpayer and the taxpayer's spouse file a joint return for the 
 taxable year.
 ``

    (2) Denial of credit to dependents.--No credit shall be 
 allowed under this section to any individual with respect to 
 whom a deduction under 

section 151 is allowable to another 
 taxpayer for a taxable year beginning in the calendar year in 
 which such individual's taxable year begins.
 ``

    (e) Reconciliation of Credit and Advance Credit.--The amount of 
the credit allowed under this section for any taxable year shall be 
reduced (but not below zero) by the amount of any advance payment of 
such credit under 

section 7527B.
 ``

    (f) Regulations.--The Secretary shall prescribe such regulations 
as may be necessary to carry out the provisions of this section, 
including regulations which provide for the coordination of the credit 
allowed under this section with the program for advance payment of the 
credit under 

section 7527B.''.

    (b) Disallowance of Deduction.--

Section 280C of the Internal 
Revenue Code of 1986 is amended by adding at the end the following new 
subsection:
 ``
            (i) Credit for Certain Flood Insurance Coverage.--No deduction 
shall be allowed for the portion of the applicable flood insurance 
premiums (as defined in 

section 36C) which is equal to the amount of 
the credit determined for the taxable year under 

section 36C

    (a) with 
respect to such premiums.''.
            (c) Conforming Amendments.--

    (1) Section 6211

    (b)

    (4)
        (A) of the Internal Revenue Code of 
 1986 is amended by inserting ``, 36C'' after ``36B''.

    (2) Paragraph

    (2) of 

section 1324

    (b) of title 31, United 
 States Code, is amended by inserting ``, 36C'' after ``36B''.
            (d) Clerical Amendment.--The table of sections for subpart C of 
part IV of subchapter A of chapter 1 of the Internal Revenue Code of 
1986 is amended by inserting after the item relating to 

section 36B the 
following new item:

``

Sec. 36C. Refundable credit for certain flood insurance coverage.''.

    (e) Effective Date.--The amendments made by this section shall 
apply to amounts paid or incurred in taxable years beginning after the 
date of the enactment of this Act.

SEC. 3. ADVANCE PAYMENTS.

    (a) In General.--Chapter 77 of the Internal Revenue Code of 1986 is 
amended by inserting after 

section 7527A the following new section:

``

SEC. 7527B. ADVANCE PAYMENT OF CREDIT FOR CERTAIN FLOOD INSURANCE 
 COVERAGE.

 ``

    (a) In General.--The Secretary shall establish a program for 
making payments of applicable flood insurance premiums (as defined in 

section 36C
            (c) ) on behalf of applicable individuals to the 
Administrator of the Federal Emergency Management Agency for such 
individuals.
 ``

    (b) Limitation on Advance Payments During Any Taxable Year.--
 ``

    (1) In general.--The Secretary may make payments under 
 subsection

    (a) only to the extent that the total amount of such 
 payments made on behalf of any applicable individual during the 
 taxable year does not exceed 33 percent of the applicable flood 
 insurance premiums (as defined in 

section 36C) paid or incurred 
 by the applicable individual during such taxable year (reduced 
 as provided under 

section 36C

    (b) based on applicable 
 information).
 ``

    (2) Applicable information.--For purposes of paragraph

    (1) , the term `applicable information' means--
 ``
        (A) tax return information for the most recent 
 taxable year for which the Secretary determines 
 information is available, or
 ``
        (B) such other information as the Secretary 
 determines is reliable to determine the amount (if any) 
 of any reduction under 

section 36C

    (b) .
 ``
            (c) Applicable Individual.--For purposes of this section, the 
term `applicable individual' means any individual who elects the 
application of this section (in such form and manner as provided by the 
Secretary).''.

    (b) Clerical Amendment.--The table of sections for chapter 77 of 
such Code is amended by inserting after the item relating to 

section 7527A the following new item:

``

Sec. 7527B. Advance payment of credit for certain flood insurance 
 coverage.''.
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