H.R. 3186 · Where this bill is now
In committee
Introduced in the House, sent to the Committee on Ways and Means, May 5, 2025
What this bill does
In plain words · AI-written from the official summaryNew tax-free savings accounts with flexible uses
This bill creates Universal Savings Accounts, a new type of savings account where you can put money in and never pay federal taxes on the earnings or money you take out. You can contribute up to $10,000 in 2025, with that limit growing by $500 each year and adjusting for inflation. Unlike most tax-advantaged savings accounts, you can use the money in a Universal Savings Account for literally any purpose—no restrictions on what you spend it on.
How it affects you
If you have money to save and want to avoid paying federal taxes on the growth, you could open one of these accounts. The accounts are available to anyone who wants to use them, though the rules include penalties if financial institutions handling these accounts don't report information correctly or if you contribute more than allowed.
Read the official summary (Introduced in House, May 5, 2025)
Universal Savings Account Act of 2025
This bill establishes Universal Savings Accounts, which are tax-advantaged savings accounts that allow contributions up to a certain amount, exempt earnings and distributions from federal income taxes, and allow distributions to be used for any purpose. (Conditions and exceptions apply.)
Specifically, the bill allows cash contributions to a Universal Savings Account of up to $10,000 in 2025 (maximum base contribution), excluding qualified amounts rolled over from another tax-advantaged account (e.g., individual retirement account). The maximum base contribution amount is increased by $500 each year beginning in 2026 and adjusted annually for inflation, up to a total maximum contribution of $25,000 (also adjusted annually for inflation beginning in 2026).
Under the bill, earnings and distributions from a Universal Savings Account are excluded from gross income for federal tax purposes and, thus, are not subject to federal income taxes (similar to the federal tax treatment of distributions from a Roth individual retirement account). (Some exceptions apply.)
Further, distributions from such accounts are not restricted and may be used for any purpose (unlike other types of tax-advantaged accounts currently available).
The bill also imposes
• a federal excise tax on contributions to a Universal Savings Account in excess of the applicable contribution limit,
• a federal excise tax on certain transactions involving a Universal Savings Account and disqualified persons,
• certain reporting requirements on Universal Savings Account trustees, and
• a federal excise tax for failing to meet such reporting requirements.
Written by AI (Claude) using only the official summary by the Congressional Research Service, the Library of Congress’s nonpartisan research staff. It can miss nuance, so check the official summary and the bill text for details.
1st SessionH. R. 3186
A BILL
Universal Savings Account Act of 2025
Sponsor: Rep. Diana Harshbarger (R-TN-1) · Introduced May 5, 2025 · Taxation · 1 version of the text
Sources: Congress.gov actions and votes · bill text from GovInfo · latest official action May 5, 2025: “Referred to the House Committee on Ways and Means.”