I 

112TH CONGRESS 

1ST SESSION H. R. 37 

To amend the Internal Revenue Code of 1986 to improve and expand 

education savings accounts. 

IN THE HOUSE OF REPRESENTATIVES 

JANUARY 5, 2011 

Mrs. BIGGERT 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 improve 

and expand education savings accounts. 

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 ‘‘401Kids Family Sav5 ings Act of 2011’’. 

6 SEC. 2. EXTENSION OF DATE FOR SUNSET OF CERTAIN 

7 EDUCATION SAVINGS INCENTIVES. 

8 In the case of the provisions of, and amendments 

9 made by, section 401 of the Economic Growth and Tax 

10 Relief Reconciliation Act of 2001 (relating to modificaVerDate Mar 15 2010 00:20 Jan 07, 2011 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H37.IH H37

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1 tions to education individual retirement accounts), section 

2 901 of such Act (relating to sunset of provisions of Act) 

3 shall be applied by substituting ‘‘December 31, 2015’’ for 

4 ‘‘December 31, 2012’’ in subsection (a)(1) thereof. 

5 SEC. 3. DISTRIBUTIONS FROM EDUCATION SAVINGS AC6 COUNTS FOR FIRST HOME PURCHASES 

7 TREATED AS QUALIFIED DISTRIBUTIONS. 

8 (a) IN GENERAL.—Subsections (b)(1), (d)(2)(A), 

9 (d)(2)(B), (d)(2)(C)(ii)(II), and (d)(2)(D) of section 530 

10 of the Internal Revenue Code of 1986 are each amended 

11 by striking ‘‘qualified education expenses’’ and inserting 

12 ‘‘qualified expenses’’. 

13 (b) QUALIFIED EXPENSES.—Subsection (b) of sec14 tion 530 of such Code is amended— 

15 (1) by redesignating paragraphs (2) through 

16 (4) as paragraphs (3) through (5), respectively, and 

17 by inserting after paragraph (1) the following new 

18 paragraph: 

19 ‘‘(2) QUALIFIED EXPENSES.—The term ‘quali20 fied expenses’ means— 

21 ‘‘(A) qualified education expenses (as de22 fined in paragraph (3)), and 

23 ‘‘(B) qualified first-time homebuyer ex24 penses (as defined in paragraph (4)).’’, and 


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1 (2) by redesignating paragraphs (4) and (5) (as 

2 redesignated by paragraph (1)) as paragraphs (5) 

3 and (6), respectively, and by inserting after para4 graph (3) the following new paragraph: 

5 ‘‘(4) QUALIFIED FIRST-TIME HOMEBUYER EX6 PENSES.—The term ‘qualified first-time homebuyer 

7 expenses’ means, in the case of a designated bene8 ficiary who is a first-time homebuyer, the qualified 

9 acquisition costs with respect to a principal resi10 dence of such beneficiary. Terms used in this para11 graph shall have the same meaning as when used in 

12 section 72(t)(8).’’. 

13 (c) CONFORMING AMENDMENT.—The heading for 

14 paragraph (2) of section 530(d) of such Code is amended 

15 by striking ‘‘QUALIFIED EDUCATION EXPENSES’’ and in16 serting ‘‘QUALIFIED EXPENSES’’. 

17 (d) EFFECTIVE DATE.—The amendments made by 

18 this section shall apply to taxable years beginning after 

19 the date of the enactment of this Act. 

20 SEC. 4. ROLLOVERS FROM EDUCATION SAVINGS ACCOUNTS 

21 TO ROTH IRAS. 

22 (a) IN GENERAL.—Paragraph (5) of section 530(d) 

23 of the Internal Revenue Code of 1986, as amended by sec24 tion 5, is amended by inserting ‘‘or a Roth IRA’’ after 

25 ‘‘another 401Kids savings account’’. 


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1 (b) CONFORMING AMENDMENT.—Subsection (e) of 

2 section 408A of such Code is amended by inserting the 

3 following after the second sentence: ‘‘Such term includes 

4 a rollover contribution to a Roth IRA from a 401Kids sav5 ings account described in section 530(d)(5).’’. 

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

7 this section shall apply to taxable years beginning after 

8 the date of the enactment of this Act. 

9 SEC. 5. RENAMING COVERDELL EDUCATION SAVINGS AC10 COUNTS AS 401KIDS SAVINGS ACCOUNTS. 

11 (a) IN GENERAL.—Section 530 of the Internal Rev12 enue Code of 1986 is amended by striking ‘‘Coverdell edu13 cation savings account’’ each place it appears and insert14 ing ‘‘401Kids savings account’’. 

15 (b) CONFORMING AMENDMENTS.— 

16 (1) The following provisions of the Internal 

17 Revenue Code of 1986 are amended by striking 

18 ‘‘Coverdell education savings’’ each place it appears 

19 and inserting ‘‘401Kids savings’’: 

20 (A) Section 26(b)(2)(E). 

21 (B) Section 72(e)(9). 

22 (C) Section 135(c)(2)(C). 

23 (D) Section 529(c)(6). 

24 (E) Section 877A(e)(2). 


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1 (F) Subsections (a) and (e) of section 

2 4973(a). 

3 (G) Subsections (c) and (e) of section 

4 4975. 

5 (H) Section 6693(a)(2)(E). 

6 (2) The headings for the following provisions of 

7 such Code are amended by striking ‘‘COVERDELL

8 EDUCATION SAVINGS’’ and inserting ‘‘401KIDS

9 SAVINGS’’: 

10 (A) Section 72(e)(9). 

11 (B) Section 135(c)(2)(C). 

12 (C) Section 529(c)(3)(B)(vi). 

13 (D) Section 530(b)(1). 

14 (E) Section 4973(e). 

15 (F) Section 4975(c)(5). 

16 (3) The heading for section 4973(e) of such 

17 Code is amended by striking ‘‘COVERDELL EDU18 CATION SAVINGS’’ and inserting ‘‘401KIDS SAV19 INGS’’. 

20 (4) The heading for section 530 of such Code 

21 is amended to read as follows: 

22 ‘‘SEC. 530. 401KIDS SAVINGS ACCOUNTS.’’. 

23 (5) The item in the table of contents for part 

24 VII of subchapter F of chapter 1 of such Code relat25 ing to section 530 is amended to read as follows: 

‘‘Sec. 530. 401Kids savings accounts.’’. 


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

2 this section shall apply to taxable years beginning after 

3 the date of the enactment of this Act. 

Æ 


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