Senate Bill 3012 Summary

• Authorizes Mississippi homeowners to establish catastrophe savings accounts to cover insurance deductibles and uninsured losses from hurricane, windstorm, or flood damage to homesteads.

• Allows taxpayers an income tax deduction for contributions to catastrophe savings accounts and exempts interest earned on these accounts from state income tax.

• Limits contributions based on insurance deductible amounts: up to $2,000 for deductibles of $1,000 or less, up to $15,000 or twice the deductible for larger deductibles, and up to $250,000 for self-insured individuals.

• Requires distributions from catastrophe savings accounts to be included in taxable income unless used for qualified catastrophe expenses, with an additional 2.5% tax penalty on non-qualified distributions (except for accounts of individuals age 70 or older or those no longer owning a homestead).

• Effective January 1, 2011.