The "Insurance Savings Account Act" establishes designated savings accounts for individuals and corporations to cover eligible insurance-related expenses, such as premiums and deductibles. Contribution limits are set at $6,000 for individuals, $12,000 for married couples filing jointly, and $25,000 for corporations. Account holders are responsible for maintaining documentation of eligible expenses and reporting account information annually to the Secretary of Revenue. The bill also clarifies that financial institutions are not required to track account usage or determine eligibility for tax modifications, and it outlines the treatment of account funds upon the account holder's death. The act is set to take effect on January 1, 2026.

In addition to establishing the savings accounts, the bill modifies the Kansas tax code to allow contributions to adoption savings accounts and insurance savings accounts, with specific contribution limits and exclusions for excess contributions. It introduces new deductions and subtractions for federal taxable income, including those related to depreciation, charitable contributions to racially segregated institutions, and health care expenditures for abortion coverage. The bill also repeals certain sections of the tax code, indicating a significant restructuring of tax obligations for Kansas residents. Overall, the legislation aims to enhance tax benefits related to savings accounts while ensuring compliance with federal regulations.

Statutes affected:
As introduced: 79-32