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 provides guidelines for the distribution of account balances upon the account holder's death. The act is set to take effect on January 1, 2026.

Additionally, the bill amends the Kansas tax code to introduce provisions for adoption and insurance savings accounts, allowing contributions starting after December 31, 2024, and December 31, 2025, respectively. It specifies that contributions and earnings will be included in taxable income if not used for authorized expenses or if a beneficiary is not designated. The bill also modifies federal adjusted gross income calculations for Kansas taxpayers, allowing for various exemptions and deductions, including those related to health care expenditures, charitable contributions, and insurance savings accounts. Certain existing statutes will be repealed, and the act will take effect upon publication in the statute book.

Statutes affected:
As introduced: 79-32