II 

115TH CONGRESS 

1ST SESSION S. 1790

To amend the Internal Revenue Code of 1986 to improve college savings 

under section 529 programs, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 12, 2017

Mr. BURR (for himself, Mr. CASEY, and Ms. MURKOWSKI) introduced the 

following bill; which was read twice and referred to the Committee on Finance 

A BILL

To amend the Internal Revenue Code of 1986 to improve 

college savings under section 529 programs, and for 

other purposes.

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 ‘‘Boost Saving for Col5 lege Act’’. 

6 SEC. 2. CREDIT FOR CONTRIBUTIONS TO 529 PLANS. 

7 (a) IN GENERAL.—Subsection (d) of section 25B of 

8 the Internal Revenue Code of 1986 (relating to elective 

9 deferrals and IRA contributions by certain individuals) is 

10 amended by redesignating paragraph (2) as paragraph (3) 

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1 and by inserting after paragraph (1) the following new 

2 paragraph: 

3 ‘‘(2) CONTRIBUTIONS TO QUALIFIED TUITION

4 PROGRAMS.—

5 ‘‘(A) IN GENERAL.—The term ‘qualified 

6 savings contribution’ includes the amount of 

7 any purchase or contribution described in para8 graph (1)(A) of section 529(b) to a qualified 

9 tuition program (as defined in such section) 

10 if—

11 ‘‘(i) the taxpayer has the power to au12 thorize distributions and otherwise admin13 ister the account, and 

14 ‘‘(ii) the designated beneficiary of 

15 such purchase or contribution is the tax16 payer, the taxpayer’s spouse, or an indi17 vidual with respect to whom the taxpayer 

18 is allowed a deduction under section 151. 

19 ‘‘(B) LIMITATION BASED ON COMPENSA20 TION.—The amount treated as a qualified sav21 ings contribution by reason of subparagraph 

22 (A) for any taxable year shall not exceed the 

23 sum of—

24 ‘‘(i) the compensation (as defined in 

25 section 219(f)(1)) includible in the taxVerDate 0ct 09 2002 22:14 Sep 13, 2017 Jkt 069200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S1790.IS S1790
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1 payer’s gross income for the taxable year, 

2 and 

3 ‘‘(ii) the amount excluded from the 

4 taxpayer’s gross income under section 112 

5 (relating to combat pay) for such year. 

6 ‘‘(C) DETERMINATION OF ADJUSTED

7 GROSS INCOME.—Solely for purposes of deter8 mining the applicable percentage under sub9 section (b) which applies with respect to the 

10 amount treated as a qualified savings contribu11 tion by reason of subparagraph (A), adjusted 

12 gross income (determined without regard to this 

13 subparagraph) shall be increased by the excess 

14 (if any) of—

15 ‘‘(i) the social security benefits re16 ceived during the taxable year (within the 

17 meaning of section 86), over 

18 ‘‘(ii) the amount included in gross in19 come for such year under section 86.’’. 

20 (b) CONFORMING AMENDMENTS.—

21 (1) Section 25B of such Code is amended by 

22 striking ‘‘qualified retirement savings’’ each place it 

23 appears in the text and inserting ‘‘qualified sav24 ings’’. 

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1 (2) The subsection heading for section 25B(d) 

2 of such Code is amended by striking ‘‘RETIRE3 MENT’’. 

4 (3) Subparagraph (A) of section 25B(d)(3) of 

5 such Code, as redesignated by subsection (a), is 

6 amended—

7 (A) by striking ‘‘paragraph (1)’’ the first 

8 place it appears and inserting ‘‘paragraph (1) 

9 or (2)’’, and 

10 (B) by striking ‘‘paragraph (1)’’ the sec11 ond place it appears and inserting ‘‘paragraph 

12 (1), or (2), as the case may be,’’. 

13 (4) The heading for section 25B of such Code 

14 is amended by striking ‘‘AND IRA CONTRIBU15 TIONS’’ and inserting ‘‘, IRA CONTRIBUTIONS, 

16 AND QUALIFIED TUITION PROGRAM CONTRIBU17 TIONS’’. 

18 (5) The table of sections for subpart A of part 

19 IV of subchapter A of chapter 1 of such Code is 

20 amended by striking the item relating to section 25B 

21 and inserting the following new item:

‘‘Sec. 25B. Elective deferrals, IRA contributions, and qualified tuition program 

contributions by certain individuals.’’.

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

23 this section shall apply to contributions made after De24 cember 31, 2017, in taxable years ending after such date. 

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1 SEC. 3. EXCLUSION FROM GROSS INCOME FOR EMPLOYER 

2 CONTRIBUTIONS TO QUALIFIED TUITION 

3 PROGRAMS. 

4 (a) IN GENERAL.—Part III of subchapter B of chap5 ter 1 of the Internal Revenue Code of 1986 (relating to 

6 items specifically excluded from gross income) is amended 

7 by inserting after section 127 the following new section: 

8 ‘‘SEC. 127A. EMPLOYER CONTRIBUTIONS TO QUALIFIED 

9 TUITION PROGRAMS. 

10 ‘‘(a) IN GENERAL.—Gross income of an employee 

11 does not include amounts paid by the employer as con12 tributions to a qualified tuition program held by the em13 ployee or spouse of the employee if the contributions are 

14 made pursuant to a program which is described in sub15 section (c). 

16 ‘‘(b) MAXIMUM EXCLUSION.—

17 ‘‘(1) IN GENERAL.—The amount excluded from 

18 the gross income of an employee under this section 

19 for the taxable year shall not exceed $1,000. 

20 ‘‘(2) INFLATION ADJUSTMENT.—

21 ‘‘(A) IN GENERAL.—In the case of any 

22 taxable year beginning in a calendar year after 

23 2018, the $1,000 amount contained in para24 graph (1) shall be increased by an amount 

25 equal to—

26 ‘‘(i) such dollar amount, multiplied by 

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1 ‘‘(ii) the cost-of-living adjustment de2 termined under section 1(f)(3) for the cal3 endar year in which the taxable year be4 gins, determined by substituting ‘calendar 

5 year 2017’ for ‘calendar year 1992’ in sub6 paragraph (B) thereof. 

7 ‘‘(B) ROUNDING.—Any increase deter8 mined under subparagraph (A) shall be rounded 

9 to the nearest multiple of $50. 

10 ‘‘(c) QUALIFIED TUITION ASSISTANCE PROGRAM.—

11 For purposes of this section, a qualified tuition assistance 

12 program is a separate written plan of an employer for the 

13 benefit of such employer’s employees—

14 ‘‘(1) under which the employer makes matching 

15 contributions to qualified tuition programs of—

16 ‘‘(A) such employees, 

17 ‘‘(B) their spouses, or 

18 ‘‘(C) any individual with respect to whom 

19 such an employee or spouse—

20 ‘‘(i) is allowed a deduction under sec21 tion 151, and 

22 ‘‘(ii) has the power to authorize dis23 tributions and otherwise administer such 

24 individual’s account under the qualified 

25 tuition program, and 

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1 ‘‘(2) which meets requirements similar to the 

2 requirements of paragraphs (2), (3), (4), (5), and 

3 (6) of section 127(b). 

4 ‘‘(d) DEFINITIONS AND SPECIAL RULES.—For pur5 poses of this section—

6 ‘‘(1) QUALIFIED TUITION PROGRAM.—The term 

7 ‘qualified tuition program’ means a qualified tuition 

8 program as defined in section 529(b). 

9 ‘‘(2) EMPLOYEE AND EMPLOYER.—The terms 

10 ‘employee’ and ‘employer’ shall have the meaning 

11 given such terms by paragraphs (2) and (3), respec12 tively, of section 127(c). 

13 ‘‘(3) APPLICABLE RULES.—Rules similar to the 

14 rules of paragraphs (4), (5), (6), and (7) of section 

15 127(c) shall apply. 

16 ‘‘(e) CROSS REFERENCE.—For reporting and record17 keeping requirements, see section 6039D.’’. 

18 (b) EXCLUSION FROM EMPLOYMENT TAXES.—

19 (1) Sections 3121(a)(18), 3306(b)(13), and 

20 3401(a)(18) of such Code are each amended by in21 serting ‘‘127A,’’ after ‘‘127,’’ each place it appears. 

22 (2) Section 3231(e)(6) of such Code is amended 

23 by striking ‘‘section 127’’ and inserting ‘‘section 127 

24 or 127A’’. 

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1 (c) REPORTING AND RECORDKEEPING REQUIRE2 MENTS.—Section 6039D(d)(1) of such Code is amended 

3 by inserting ‘‘127A,’’ after ‘‘127,’’. 

4 (d) OTHER CONFORMING AMENDMENTS.—

5 (1) Sections 125(f), 414(n)(3)(C), and 

6 414(t)(2) of such Code are each amended by insert7 ing ‘‘127A,’’ after ‘‘127,’’ each place it appears. 

8 (2) Section 132(j)(8) of such Code is amended 

9 by striking ‘‘section 127’’ and inserting ‘‘section 127 

10 or 127A’’. 

11 (3) Section 221(d)(2)(A) of such Code is 

12 amended by inserting ‘‘127A,’’ after ‘‘127’’. 

13 (4) Section 1397(a)(2)(A) of such Code is 

14 amended by inserting at the end the following new 

15 clause: 

16 ‘‘(iii) Any amount paid or incurred by 

17 an employer which is excludable from the 

18 gross income of an employee under section 

19 127A, but only to the extent paid or in20 curred to a person not related to the em21 ployer.’’. 

22 (5) Section 209(a)(15) of the Social Security 

23 Act (42 U.S.C. 409(a)(15)) is amended by striking 

24 ‘‘or 129’’ and inserting ‘‘, 127A, or 129’’. 

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1 (e) CLERICAL AMENDMENT.—The table of sections 

2 for part III of subchapter B of chapter 1 of such Code 

3 is amended by inserting after the item relating to section 

4 127 the following new item:

‘‘Sec. 127A. Employer contributions to qualified tuition programs.’’.

5 (f) EFFECTIVE DATE.—The amendments made by 

6 this section shall apply to taxable years beginning after 

7 December 31, 2017. 

8 SEC. 4. SPECIAL ROLLOVER TO ROTH IRA FROM LONG9 TERM QUALIFIED TUITION PROGRAM. 

10 (a) IN GENERAL.—Paragraph (3) of section 529(c) 

11 of the Internal Revenue Code of 1986 is amended by add12 ing at the end the following new subparagraph: 

13 ‘‘(E) SPECIAL ROLLOVER TO ROTH IRA

14 FROM LONG-TERM QUALIFIED TUITION PRO15 GRAM.—For purposes of this section—

16 ‘‘(i) IN GENERAL.—In the case of a 

17 distribution from a qualified tuition pro18 gram which has been maintained by an ac19 count owner for the 10-year period ending 

20 on the date of such distribution—

21 ‘‘(I) subparagraph (A) shall not 

22 apply to any portion of such distribu23 tion which, not later than 60 days 

24 after such distribution, is paid into a 

25 Roth IRA maintained for the benefit 

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1 of such account owner or the des2 ignated beneficiary under such quali3 fied tuition program, and 

4 ‘‘(II) such portion shall be treat5 ed as a rollover contribution for pur6 poses of section 408A(e). 

7 ‘‘(ii) LIMITATION.—Clause (i) shall 

8 only apply to so much of any distribution 

9 as does not exceed the lesser of—

10 ‘‘(I) the amount applicable to the 

11 account owner under section 

12 408A(c)(2) for the taxable year, or 

13 ‘‘(II) the aggregate amount con14 tributed to the program (and earnings 

15 attributable thereto) before the 5-year 

16 period ending on the date of the dis17 tribution.’’. 

18 (b) QUALIFIED ROLLOVER CONTRIBUTION.—Para19 graph (1) of section 408A(e) of such Code is amended by 

20 striking the period at the end of subparagraph (B) and 

21 inserting ‘‘, and’’ and by inserting after subparagraph (B) 

22 the following new subparagraph: 

23 ‘‘(C) from a qualified tuition program to 

24 the extent provided in section 529(c)(3)(E).’’. 

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

2 this section shall apply with respect to distributions after 

3 December 31, 2017. 

4 SEC. 5. ROLLOVERS TO ABLE PROGRAMS FROM 529 PRO5 GRAMS. 

6 (a) IN GENERAL.—Clause (i) of section 529(c)(3)(C) 

7 of the Internal Revenue Code of 1986 is amended by strik8 ing ‘‘or’’ at the end of subclause (I), by striking the period 

9 at the end of subclause (II) and inserting ‘‘, or’’, and by 

10 adding at the end the following: 

11 ‘‘(III) to an ABLE account (as 

12 defined in section 529A(e)(6)) of the 

13 designated beneficiary. 

14 Subclause (III) shall not apply to so much 

15 of a distribution which, when added to all 

16 other contributions made to the ABLE ac17 count for the taxable year, exceeds the lim18 itation under section 529A(b)(2)(B).’’. 

19 (b) EFFECTIVE DATE.—The amendments made by 

20 this section shall apply to distributions after the date of 

21 the enactment of this Act.

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