I 

109TH CONGRESS 

1ST SESSION H. R. 264 

To amend the Internal Revenue Code of 1986 to allow a lump sum contribution to Coverdell education savings accounts whenever the contribution 

limit is increased. 

IN THE HOUSE OF REPRESENTATIVES 

JANUARY 6, 2005 

Mr. BRADLEY of New Hampshire 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 a 

lump sum contribution to Coverdell education savings 

accounts whenever the contribution limit is increased. 

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 ‘‘Enhancing Resources 

5 Utilized in Developing Investments for Tuition Expendi6 tures Act of 2003’’. 
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1 SEC. 2. LUMP SUM CONTRIBUTION TO COVERDELL EDU2 CATION SAVINGS ACCOUNTS. 

3 (a) IN GENERAL.—Clause (iii) of section 

4 530(b)(1)(A) of the Internal Revenue Code of 1986 is 

5 amended by inserting ‘‘and new limit lump sum contribu6 tions’’ after ‘‘rollover contributions’’. 

7 (b) NEW LIMIT LUMP SUM CONTRIBUTIONS.—Sub8 section (b) of section 530 of such Code is amended by 

9 adding at the end the following new paragraph: 

10 ‘‘(6) NEW LIMIT LUMP SUM CONTRIBUTIONS.— 

11 The amount of the new limit lump sum contribution 

12 for any taxable year may not exceed the excess of— 

13 ‘‘(A) $250 multiplied by a fraction— 

14 ‘‘(i) the numerator of which is the 

15 amount in effect for the taxable year under 

16 paragraph (1)(A)(iii), and 

17 ‘‘(ii) the denominator of which is 

18 $250 or, if the beneficiary of the Coverdell 

19 education savings account was born after 

20 December 31, 1997, the amount in effect 

21 under paragraph (1)(A)(iii) on the date of 

22 such birth, over 

23 ‘‘(B) the aggregate of the amounts deter24 mined under subparagraph (A) with respect to 

25 such contributions for all previous taxable 

26 years.’’. 
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1 (c) TAX ON EXCESS CONTRIBUTIONS.— 

2 (1) IN GENERAL.—Subsection (e) of section 

3 4973 of such Code is amended by adding at the end 

4 the following new paragraph: 

5 ‘‘(3) RULE FOR NEW LIMIT LUMP SUM CON6 TRIBUTION.—In the case of new limit lump sum 

7 contributions to Coverdell education savings ac8 counts maintained for the benefit of any one bene9 ficiary, the term ‘excess contributions’ means the 

10 sum of— 

11 ‘‘(A) the amount by which the amount con12 tributed for the taxable year to such accounts 

13 exceeds the dollar amount in effect under sec14 tion 530(b)(6) (or, if less, the sum of the max15 imum amounts permitted to be contributed 

16 under section 530(c) by the contributors to 

17 such accounts for such year), and 

18 ‘‘(B) the amount determined under this 

19 subsection for the preceding taxable year, re20 duced by the sum of— 

21 ‘‘(i) the distributions out of the ac22 counts for the taxable year (other than 

23 rollover distributions and contributions to 

24 which paragraph (1) applies), and 
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1 ‘‘(ii) the excess (if any) of the max2 imum new limit lump sum contribution 

3 which may be contributed to the accounts 

4 for the taxable year over the new limit 

5 lump sum contribution contributed to the 

6 accounts for the taxable year.’’. 

7 (2) EXCEPTION TO ANNUAL RULE.—Paragraph 

8 (2) of section 4973(e) of such Code is amended by 

9 adding after subparagraph (B) the following new 

10 subparagraph: 

11 ‘‘(C) Any new limit lump sum contribution 

12 (as defined in section 530(b)(6)).’’. 

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

14 this section shall apply to taxable years beginning after 

15 the date of the enactment of this Act. 

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