119th Congress (2025-2026)

HR 5504

Flood Insurance Tax Credit Act of 2025

Introduced

Jurisdiction

US Congress

Session

119th Congress (2025-2026)

Official source

Chamber

House

Session

119th Congress (2025-2026)

Jurisdiction

US Congress

Bill overview

This bill, the Flood Insurance Tax Credit Act of 2025, creates a tax credit for homeowners to help offset the cost of flood insurance. It allows taxpayers to claim a credit equal to the lesser of their federal and private flood insurance expenses, up to a combined maximum of $1,500 plus $3,000 for private insurance and $600 for contents coverage. The credit is phased out based on income, with higher-income taxpayers seeing a greater reduction in the credit amount.

Key provisions

Allows a tax credit for flood insurance expenses.
The credit is capped at $1,500 plus $3,000 for private insurance and $600 for contents coverage.
The credit is phased out based on taxpayer income.
Federal flood insurance expenses are defined as premiums paid for coverage under the National Flood Insurance Act of 1968.
Private flood insurance expenses include premiums for coverage not under the National Flood Insurance Act of 1968.
The credit is only available for expenses related to a taxpayer’s principal residence.
Inflation adjustments will increase the credit amounts annually, starting in 2026.
A credit cannot be claimed if a deduction is taken for the same expenses.

Who is affected

Homeowners
Taxpayers
Individuals with flood insurance policies

Notable changes

Establishes a new tax credit specifically for flood insurance expenses.
Introduces income-based phaseout provisions for the credit.

Positions across the country

No public positions recorded for this legislation.

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Arguments opposed

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Legislative history

2025-09-18House

Referred to the House Committee on Ways and Means.

2025-09-18

Introduced in House

2025-09-18

Introduced in House

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Sep 18, 2025XMLView source

119th CONGRESS — 1st Session

H. R. 5504

IN THE HOUSE OF REPRESENTATIVES

A BILL

To amend the Internal Revenue Code of 1986 to allow for a credit against tax for certain flood insurance expenses.

1.Short title

This Act may be cited as the

Flood Insurance Tax Credit Act of 2025

2.Credit for flood insurance expenses

(a)In generalSubpart A of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after section 25F the following new section:

25G.Flood insurance expenses

(a)Allowance of creditThere shall be allowed as a credit against the tax imposed by this subtitle for a taxpayer for a taxable year an amount equal to the sum of—

(1)

the lesser of—

(A)

the Federal flood insurance expenses of the taxpayer for the taxable year, and

(B)

$1,500, plus

(2)

the lesser of—

(A)50 percent of the private flood insurance expenses of the taxpayer for the taxable year, and

(B)

$3,000, plus

(3)

the lesser of—

(A)Federal contents coverage flood insurance expenses of the taxpayer for the taxable year, and

(B)

$600.

(b)Phaseout

(1)Federal flood insurance expense

The amount determined under subsection (a)(1) for a taxpayer for a taxable year shall be reduced (but not below zero) by—

(A)in the case of a joint return, 1.5 percent of so much of the taxpayer’s income for such taxable year as exceeds $100,000, and

(B)in any other case, 3 percent of so much of the taxpayer’s income for such taxable year as exceeds $50,000.

(2)Private flood insurance expense

The amount determined under subsection (a)(2) for a taxpayer for a taxable year shall be reduced (but not below zero) by—

(A)in the case of a joint return, 3 percent of so much of the taxpayer’s income for such taxable year as exceeds $100,000, and

(B)in any other case, 6 percent of so much of the taxpayer’s income for such taxable year as exceeds $50,000.

(3)Federal contents coverage flood insurance expense

The amount determined under subsection (a)(3) for a taxpayer for a taxable year shall be reduced (but not below zero) by—

(A)in the case of a joint return, 0.6 percent of so much of the taxpayer’s income for such taxable year as exceeds $100,000, and

(B)in any other case, 1.2 percent of so much of the taxpayer’s income for such taxable year as exceeds $50,000.

(c)DefinitionFor purposes of this section:

(1)Federal flood insurance expenseThe term Federal flood insurance expense means the excess of—

(A)

amounts paid or incurred as premiums for flood insurance coverage made available under the National Flood Insurance Act of 1968, over

(B)Federal contents coverage flood insurance expense.

(2)Private flood insurance expenseThe term private flood insurance expense means amounts paid or incurred as premiums for flood insurance coverage other than flood insurance coverage made available under the National Flood Insurance Act of 1968, including such coverage for the contents of a structure.

(3)Federal contents coverage flood insurance expenseThe term Federal contents coverage flood insurance expense means amounts paid or incurred as premiums for flood insurance coverage made available under the National Flood Insurance Act of 1968 for contents of a structure.

(d)Primary residenceFederal flood insurance expenses, private flood insurance expenses, and Federal contents coverage flood insurance expenses shall only be taken into account to the extent that such expenses are paid or incurred for coverage related to the taxpayer’s principal residence (as such term is used in section 121).

(e)Denial of double benefitNo credit shall be allowed under subsection (a) for any amount with respect to which a deduction is allowed due to subsection (c) or (e) of section 280A.

(f)Inflation adjustmentIn the case of any taxable year beginning in calendar years after 2026, each of the dollar amounts in subsections (a) and (b) shall be increased by an amount equal to—

(1)

such dollar amount, multiplied by

(2)

the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting 2025 for 2016 in subparagraph (A)(ii) thereof.

If any amount after adjustment under the preceding sentence is not a multiple of $50, such amount shall be rounded to the next lowest multiple of $50.

(b)Clerical amendmentThe table of sections for subpart A of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after the item relating to section 25F the following new item:

Sec. 25G. Flood insurance expenses..

(c)Effective dateThe amendments made by this section shall apply to taxable years beginning after December 31, 2025.

HR 5504

Bill overview

Key provisions

Who is affected

Notable changes

Sponsors

Primary sponsor

Positions across the country

Arguments in favor

Arguments opposed

Bill text

Positions across the country