Crenshaw: Disaster Savings Account Act Gives Homeowners Edge in Preparing for Natural Disasters

WASHINGTON, D.C. – February 6, 2014 – (RealEstateRama) — Congressman Ander Crenshaw, Chairman of the House Financial Services and General Government Appropriations Subcommittee, today( 2/5) announced his support for the Disaster Savings Account Act (HR 3989) – legislation allowing for the creation of tax-free savings accounts for homeowners to set aside up to $5,000 to strengthen their homes against hurricanes and other disasters.

“You can’t fool Mother Nature, but a Disaster Savings Account provides some added incentive to at least prepare for her. Living in the path of oncoming hurricanes, homeowners in Florida understand that shoring up property ahead of the storm saves time and money later. Americans along the Gulf states, in tornado alley, or wildfire and earthquake-prone regions know the same.” said Crenshaw. “By installing cement-fortified walls, storm shutters, generators or another feature, safety increases and the need for taxpayer-funded government intervention decreases. For every dollar spent on disaster mitigation the federal government saves between three to four dollars in future rebuilding costs, according to recent statistics: that’s a win-win all around.”

BACKGROUND:

Any homeowner with homeowner’s insurance has the opportunity to participate in a Disaster Savings Account (DSA), which makes available to homeowners an annual tax deduction equivalent to the amount of funds deposited into a DSA, up to $5,000 per year. Unused funds can be rolled over from year to year.

Any expense that would help to fortify a home in preparation for, or in recovery from, a natural disaster event is a qualified expense; for example, storm-proof shutter or window panes, whole home generators, or reinforced walls. Account funds are also qualified for use toward personal property losses in and around the home, resulting from a natural disaster, not otherwise covered by insurance, including natural disaster from floods.