H.R. 3186 — Universal Savings Account Act of 2025

This section establishes Universal Savings Accounts (USAs) as new tax-exempt trusts under a new IRC §530A for the exclusive benefit of an individual, with tax-free earnings and distributions (except net income attributable to excess contributions, which is taxable). USAs require cash contributions only (except qualified rollovers from another USA within 60 days), a permissible trustee (i.e., bank or Secretary-approved entity), nonforfeitable interests, no commingling except in common funds, and no life insurance investments; upon the account holder's death, a surviving spouse's interest is treated as the spouse's own USA, while other beneficiaries receive full distribution and account termination. Annual non-rollover contributions are limited to $10,000 plus $500 for each year after 2024 and before the contribution year (inflation-adjusted after 2025), capped at $25,000 (also inflation-adjusted after 2025); excess contributions are subject to tax under amended IRC §4973. Custodial accounts meeting trust requirements are treated as USAs, and trustees must report contributions and distributions to the Secretary and beneficiary.