I

106TH CONGRESS

1ST SESSION H. R. 935

To amend the Internal Revenue Code of 1986 to allow individuals a credit

against income tax for tuition and related expenses for public and nonpublic elementary and secondary education.

IN THE HOUSE OF REPRESENTATIVES

MARCH 2, 1999

Mr. PAUL (for himself and Mr. HOSTETTLER) introduced the following bill;

which was referred to the Committee on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to allow individuals a credit against income tax for tuition and related expenses for public and nonpublic elementary and

secondary education.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Family Education

5 Freedom Act of 1999’’.
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1 SEC. 2. CREDIT FOR TUITION AND RELATED EXPENSES

2 FOR PUBLIC AND NONPUBLIC ELEMENTARY

3 AND SECONDARY EDUCATION.

4 (a) IN GENERAL.—Subpart A of part IV of sub5 chapter A of chapter 1 of the Internal Revenue Code of

6 1986 (relating to nonrefundable personal credits) is

7 amended by inserting after section 25A the following new

8 section:

9 ‘‘SEC. 25B. TUITION AND RELATED EXPENSES FOR PUBLIC

10 AND NONPUBLIC ELEMENTARY AND SECOND11 ARY EDUCATION.

12 ‘‘(a) ALLOWANCE OF CREDIT.—In the case of an in13 dividual, there shall be allowed as a credit against the tax

14 imposed by this chapter for the taxable year an amount

15 equal to the qualified educational expenses paid during

16 such taxable year for the elementary or secondary edu17 cation of any dependent (as defined in section 152) of the

18 taxpayer at a qualified educational institution.

19 ‘‘(b) LIMITATION.—The credit allowed by this section

20 shall not exceed $3,000 per student for any taxable year.

21 ‘‘(c) DEFINITIONS.—For purposes of this section—

22 ‘‘(1) QUALIFIED EDUCATIONAL EXPENSES.—

23 The term ‘qualified educational expenses’ means cost

24 of attendance in connection with the elementary or

25 secondary education of the student at a qualified

26 educational institution. Under regulations prescribed
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1 by the Secretary, rules similar to the rules relating

2 to cost of attendance (within the meaning of section

3 472 of the Higher Education Act of 1965 (20

4 U.S.C. 1087ll) (as in effect on the date of the enact5 ment of this paragraph) shall apply for purposes of

6 the preceding sentence.

7 ‘‘(2) QUALIFIED EDUCATIONAL INSTITUTION.—

8 The term ‘qualified educational institution’ means

9 any educational institution (including any private,

10 parochial, religious, or home school) organized for

11 the purpose of providing elementary or secondary

12 education, or both.

13 ‘‘(d) ADJUSTMENTS FOR INFLATION.—

14 ‘‘(1) IN GENERAL.—In the case of any taxable

15 year beginning in a calendar year after 1999, the

16 $3,000 amount contained in subsection (b) shall be

17 increased by an amount equal to—

18 ‘‘(A) $3,000, multiplied by

19 ‘‘(B) the cost-of-living adjustment deter20 mined under section 1(f)(3) for the calendar

21 year in which the taxable year begins by sub22 stituting ‘calendar year 1998’ for ‘calendar year

23 1992’ in subparagraph (B) thereof.

24 ‘‘(2) ROUNDING.—If any increase determined

25 under paragraph (1) is not a multiple of $10, such
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1 increase shall be rounded to the next highest mul2 tiple of $10.’’.

3 (b) CLERICAL AMENDMENT.—The table of sections

4 for such subpart A is amended by inserting after the item

5 relating to section 25A the following new item:

‘‘Sec. 25B. Tuition and related expenses for public and nonpublic

elementary and secondary education.’’

6 (c) EFFECTIVE DATE.—The amendments made by

7 this section shall apply to amounts paid after the date of

8 the enactment of this Act in taxable years ending after

9 such date.

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