The "Insurance Savings Account Act" establishes a framework for individuals and corporations to open designated insurance savings accounts with financial institutions starting January 1, 2027. These accounts can be utilized for paying or reimbursing eligible expenses, such as insurance premiums and deductibles, with contribution limits set at $6,000 for individuals, $12,000 for married couples filing jointly, and $25,000 for corporations. In the event of the account holder's death, the account balance will be transferred to a designated beneficiary or according to probate laws if no beneficiary is named. The bill also clarifies the responsibilities of account holders regarding documentation and fund usage, while stating that financial institutions are not required to track account usage or determine eligibility for tax modifications.

Additionally, the bill modifies the Kansas tax code to include provisions for contributions to adoption and insurance savings accounts, allowing for tax exclusions on income earned from these accounts. It introduces specific adjustments to federal adjusted gross income and outlines conditions for corporations in determining their Kansas taxable income. The legislation aims to provide tax relief and incentives for savings in adoption and insurance accounts while ensuring compliance with federal tax regulations. The act is set to take effect upon publication in the statute book, indicating prompt implementation of these changes.

Statutes affected:
As introduced: 79-32