Secure Family Futures Act of 2025
- Bill Number
- H.R. 2547
- Origin Chamber
- House
- Congress
- 119th Congress, Session 1
- Policy Area
- Taxation
- Status
- Introduced
- Latest Action
- 2025-04-01: Referred to the House Committee on Ways and Means.
- Last Updated
- 2026-06-23T08:05:49Z
AI-Generated Summary
Purpose of the Legislation
The "Secure Family Futures Act of 2025" (H.R. 2547) aims to modify tax rules under the Internal Revenue Code of 1986 specifically for certain insurance companies. It seeks to adjust how debt investments are treated for tax purposes and extend the time these companies can use capital losses to reduce future taxes, potentially easing their financial planning and tax burdens.
Key Provisions
- Exclusion of Debt from Capital Assets (Section 2):
- Debt instruments (such as notes, bonds, debentures, or other evidence of indebtedness) held by "applicable insurance companies" will not be classified as capital assets.
- Applicable insurance company is defined as any insurance company that does not fall into specific excluded categories, including:
- Companies electing special small insurance tax treatment under section 831(b).
- Foreign insurance corporations subject to section 842.
- Organizations qualifying for cooperative health insurance tax rules under section 833.
- Face-amount certificate companies registered under the Investment Company Act of 1940 (investment vehicles that issue certificates promising a fixed payout).
- This change applies to debt acquired after December 31, 2025.
- Extension of Capital Loss Carryovers (Section 3):
- Capital losses (losses from selling investments like stocks or bonds at a lower price than purchased) incurred by applicable insurance companies can be carried forward to offset taxable income for up to 10 years after the loss year.
- This also applies to losses from foreign expropriation (government seizure of assets abroad).
- The rule takes effect for losses arising in tax years beginning after December 31, 2025.
Significant Changes to Existing Law
- Under current law, debt held by insurance companies is typically treated as a capital asset, meaning any gains from selling it are taxed at capital gains rates (often lower than ordinary income rates), but losses are subject to a 5-year carryover limit.
- The bill removes debt from the capital asset definition for applicable insurance companies, shifting how gains and losses are calculated and taxed in their specific insurance tax regime (which already has unique rules for investment income).
- It doubles the capital loss carryover period from 5 to 10 years, providing more flexibility to apply losses against future profits.
Potential Impacts
- On Government Agencies: The Internal Revenue Service (IRS) may see administrative changes in auditing and processing tax returns for insurance companies, potentially reducing short-term revenue from faster loss utilization but stabilizing long-term tax collections from the insurance sector.
- On Citizens: Indirect benefits for policyholders and beneficiaries of applicable insurance companies, as tax savings could lower premiums or improve financial stability for life, health, or property insurers. No direct impact on individual taxpayers outside the insurance industry.
- On International Relations: Minimal direct effects, though it could influence U.S. insurance companies' competitiveness against foreign insurers by excluding certain foreign entities from these benefits, potentially affecting cross-border investment flows.
Main Stakeholders Affected
- Primary Beneficiaries: Applicable insurance companies (most domestic life, property-casualty, and other insurers not in the excluded categories), which gain tax planning advantages for managing debt portfolios and losses.
- Excluded Groups: Smaller or specialized insurers (e.g., micro-captive insurers under section 831(b)), foreign insurance firms, and certain health cooperatives, who do not receive these changes.
- Broader Interests: Insurance policyholders, investors in insurance stocks, and the U.S. Treasury, which collects taxes from the industry.
Notable Legal, Constitutional, or Political Implications
- Legal: Aligns with existing special tax rules for insurance companies (under subchapter L of the Internal Revenue Code), avoiding broad disruptions but requiring IRS guidance on implementation. No challenges to tax equity are evident, as it targets a regulated industry.
- Constitutional: No apparent issues with equal protection or due process, as the changes are narrowly tailored to a specific sector without discriminating against individuals.
- Political: Represents targeted tax relief for the insurance industry, potentially supported by business interests but criticized as a loophole favoring large corporations. As an amendment to the tax code, it could influence future budget reconciliation debates in Congress.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Cosponsors (52)
Rep. Sewell, Terri A. [D-AL-7], Rep. Flood, Mike [R-NE-1], Rep. Tenney, Claudia [R-NY-24], Rep. McCormick, Richard [R-GA-7], Rep. Kustoff, David [R-TN-8], Rep. Fitzpatrick, Brian K. [R-PA-1], Rep. Meuser, Daniel [R-PA-9], Rep. Malliotakis, Nicole [R-NY-11], Rep. Nunn, Zachary [R-IA-3], Rep. Moore, Blake D. [R-UT-1], Rep. Moran, Nathaniel [R-TX-1], Rep. Fitzgerald, Scott [R-WI-5], Rep. Timmons, William R. [R-SC-4], Rep. Burlison, Eric [R-MO-7], Rep. Smucker, Lloyd [R-PA-11], Rep. Panetta, Jimmy [D-CA-19], Rep. Lawler, Michael [R-NY-17], Rep. Miller-Meeks, Mariannette [R-IA-1], Rep. Moore, Gwen [D-WI-4], Rep. Cleaver, Emanuel [D-MO-5], Rep. Boyle, Brendan F. [D-PA-2], Rep. Davis, Danny K. [D-IL-7], Rep. LaHood, Darin [R-IL-16], Rep. Estes, Ron [R-KS-4], Rep. Garbarino, Andrew R. [R-NY-2], Rep. Suozzi, Thomas R. [D-NY-3], Rep. Hinson, Ashley [R-IA-2], Rep. Buchanan, Vern [R-FL-16], Rep. Van Duyne, Beth [R-TX-24], Rep. Kelly, Mike [R-PA-16], Rep. Larson, John B. [D-CT-1], Rep. Sánchez, Linda T. [D-CA-38], Rep. Miller, Max L. [R-OH-7], Rep. Morelle, Joseph D. [D-NY-25], Rep. Mackenzie, Ryan [R-PA-7], Rep. Kennedy, Timothy M. [D-NY-26], Rep. Yakym, Rudy [R-IN-2], Rep. McDonald Rivet, Kristen [D-MI-8], Rep. DelBene, Suzan K. [D-WA-1], Rep. Schneider, Bradley Scott [D-IL-10], Rep. Scott, David [D-GA-13], Rep. Steil, Bryan [R-WI-1], Rep. Wagner, Ann [R-MO-2], Rep. Kim, Young [R-CA-40], Rep. Huizenga, Bill [R-MI-4], Rep. Bishop, Sanford D. [D-GA-2], Rep. Gottheimer, Josh [D-NJ-5], Rep. Conaway, Herbert C. [D-NJ-3], Rep. Pou, Nellie [D-NJ-9], Rep. Norcross, Donald [D-NJ-1] and 2 more
Recent Actions
- 2025-04-01: Referred to the House Committee on Ways and Means.
- 2025-04-01: Introduced in House
- 2025-04-01: Introduced in House
Bill Versions
- Secure Family Futures Act of 2025 — issued 2025-04-01 — PDF (4 pages)