I 

116TH CONGRESS 

1ST SESSION H. R. 898 

To amend the Internal Revenue Code of 1986 to provide for lifelong learning 

accounts, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JANUARY 30, 2019 

Mr. KILMER (for himself, Mr. THOMPSON of Pennsylvania, Mr. PETERS, Mr. 

FITZPATRICK, Mr. POSEY, Miss RICE of New York, Mrs. LURIA, and Ms. 

KUSTER 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 provide 

for lifelong learning accounts, 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 ‘‘Skills Investment Act 

5 of 2019’’. 

6 SEC. 2. COVERDELL LIFELONG LEARNING ACCOUNTS. 

7 (a) IN GENERAL.— 


pamtmann on DSKBFK8HB2PROD with BILLS
2 

•HR 898 IH

1 (1) RENAMING OF COVERDELL EDUCATION SAV2 INGS ACCOUNTS.—Section 530 of the Internal Rev3 enue Code of 1986 is amended— 

4 (A) by striking ‘‘Coverdell education sav5 ings account’’ each place it appears and insert6 ing ‘‘Coverdell lifelong learning account’’; and 

7 (B) by striking ‘‘COVERDELL EDU8 CATION SAVINGS ACCOUNTS’’ in the heading 

9 and inserting ‘‘COVERDELL LIFELONG

10 LEARNING ACCOUNTS’’. 

11 (2) CONFORMING AMENDMENTS.— 

12 (A) Section 26(b)(2)(E) of the Internal 

13 Revenue Code of 1986 is amended by striking 

14 ‘‘Coverdell education savings accounts’’ and in15 serting ‘‘Coverdell lifelong learning accounts’’. 

16 (B) Section 72(e)(9) of such Code is 

17 amended— 

18 (i) by striking ‘‘Coverdell education 

19 savings account’’ and inserting ‘‘Coverdell 

20 lifelong learning account’’; and 

21 (ii) by striking ‘‘COVERDELL EDU22 CATION SAVINGS ACCOUNT’’ in the heading 

23 and inserting ‘‘COVERDELL LIFELONG

24 LEARNING ACCOUNT’’. 


pamtmann on DSKBFK8HB2PROD with BILLS
3 

•HR 898 IH

1 (C) Section 135(c)(2)(C) of such Code is 

2 amended— 

3 (i) by striking ‘‘Coverdell education 

4 savings account’’ and inserting ‘‘Coverdell 

5 lifelong learning account’’; and 

6 (ii) by striking ‘‘COVERDELL EDU7 CATION SAVINGS ACCOUNT’’ in the heading 

8 and inserting ‘‘COVERDELL LIFELONG

9 LEARNING ACCOUNT’’. 

10 (D) Section 408A(e)(2)(A)(ii) of such Code 

11 is amended by striking ‘‘Coverdell education 

12 savings account’’ and inserting ‘‘Coverdell life13 long learning account’’. 

14 (E) Section 529(c) of such Code is amend15 ed— 

16 (i) by striking ‘‘COVERDELL EDU17 CATION SAVINGS ACCOUNTS’’ in the head18 ing of paragraph (3)(B)(vi) and inserting 

19 ‘‘COVERDELL LIFELONG LEARNING AC20 COUNT’’; and 

21 (ii) by striking ‘‘an Coverdell edu22 cation savings account’’ in paragraph (6) 

23 and inserting ‘‘a Coverdell lifelong learning 

24 account’’. 


pamtmann on DSKBFK8HB2PROD with BILLS
4 

•HR 898 IH

1 (F) Section 877A(e)(2) of such Code is 

2 amended by striking ‘‘Coverdell education sav3 ings account’’ and inserting ‘‘Coverdell lifelong 

4 learning account’’. 

5 (G) Section 4973 of such Code is amend6 ed— 

7 (i) by striking ‘‘Coverdell education 

8 savings account’’ each place it appears in 

9 subsections (a)(4) and (e)(2)(A) and in10 serting ‘‘Coverdell lifelong learning ac11 count’’; 

12 (ii) by striking ‘‘Coverdell education 

13 savings accounts’’ in subsection (e)(1) and 

14 inserting ‘‘Coverdell lifelong learning ac15 counts’’; and 

16 (iii) by striking ‘‘COVERDELL EDU17 CATION SAVINGS ACCOUNTS’’ in the head18 ing of subsection (e) and inserting 

19 ‘‘COVERDELL LIFELONG LEARNING AC20 COUNT’’. 

21 (H) Section 4975 of such Code is amend22 ed— 

23 (i) by striking ‘‘Coverdell education 

24 savings account’’ each place it appears in 

25 subsections (c)(5) and (e)(1)(F) and inVerDate Sep 11 2014 21:01 Feb 11, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H898.IH H898

pamtmann on DSKBFK8HB2PROD with BILLS
5 

•HR 898 IH

1 serting ‘‘Coverdell lifelong learning ac2 count’’; and 

3 (ii) by striking ‘‘COVERDELL EDU4 CATION SAVINGS ACCOUNTS’’ in the head5 ing of subsection (c)(5) and inserting 

6 ‘‘COVERDELL LIFELONG LEARNING AC7 COUNTS’’. 

8 (I) Section 6693(a)(2)(F) of such Code is 

9 amended by striking ‘‘Coverdell education sav10 ings accounts’’ and inserting ‘‘Coverdell lifelong 

11 learning accounts’’. 

12 (J) The table of sections for part VIII of 

13 subchapter F of chapter 1 of such Code is 

14 amended by striking ‘‘Coverdell education sav15 ings accounts’’ and inserting ‘‘Coverdell lifelong 

16 learning accounts’’. 

17 (3) TREATMENT OF EXISTING ACCOUNTS.—For 

18 purposes of section 530(b)(1) of the Internal Rev19 enue Code of 1986, any account established before 

20 January 1, 2019, and designated as a Coverdell edu21 cation savings account shall be deemed to have been 

22 designated as a Coverdell lifelong learning account. 

23 (b) EXPANDED USE OF ACCOUNTS.— 

24 (1) ELIGIBLE EXPENSES.— 


pamtmann on DSKBFK8HB2PROD with BILLS
6 

•HR 898 IH

1 (A) IN GENERAL.—Section 530(b)(2)(A) of 

2 the Internal Revenue Code of 1986 is amended 

3 by striking ‘‘and’’ at the end of clause (i), by 

4 striking the period at the end of clause (ii) and 

5 inserting ‘‘, and’’, and by adding at the end the 

6 following new clause: 

7 ‘‘(iii) qualified educational or skill de8 velopment expenses (as defined in para9 graph (5)).’’. 

10 (B) QUALIFIED EDUCATIONAL OR SKILL

11 DEVELOPMENT EXPENSES.—Section 530(b) of 

12 such Code is amended by adding at the end the 

13 following new paragraph: 

14 ‘‘(5) QUALIFIED EDUCATIONAL OR SKILL DE15 VELOPMENT EXPENSES.—The term ‘qualified edu16 cational or skill development expenses’ means— 

17 ‘‘(A) expenses paid or incurred— 

18 ‘‘(i) after the beneficiary attains age 

19 16, and 

20 ‘‘(ii) for participation or enrollment of 

21 the beneficiary in services or activities that 

22 are— 

23 ‘‘(I) training services described in 

24 section 134(c)(3)(D) of the Workforce 

25 Innovation and Opportunity Act (29 


pamtmann on DSKBFK8HB2PROD with BILLS
7 

•HR 898 IH

1 U.S.C. 3174(c)(3)(D)) that are of2 fered by a provider included on the 

3 list of eligible providers of training 

4 services described in section 122 of 

5 such Act (29 U.S.C. 3152), 

6 ‘‘(II) career and technical edu7 cation activities defined in section 3 of 

8 the Carl D. Perkins Career and Tech9 nical Education Act of 2006 (20 

10 U.S.C. 2302) that are offered through 

11 an eligible institution (as defined in 

12 such section), 

13 ‘‘(III) career services described in 

14 clauses (iii), (iv), and (xi) of section 

15 134(c)(2)(A) of the Workforce Inno16 vation and Opportunity Act (29 

17 U.S.C. 3174(c)(2)(A)) that are pro18 vided by providers eligible under sec19 tion 134(c)(2)(C) of such Act, 

20 ‘‘(IV) youth activities described 

21 in section 129(c)(2) of the Workforce 

22 Innovation and Opportunity Act (29 

23 U.S.C. 3164(c)(2)) that are provided 

24 by eligible providers of youth workVerDate Sep 11 2014 21:01 Feb 11, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H898.IH H898

pamtmann on DSKBFK8HB2PROD with BILLS
8 

•HR 898 IH

1 force investment activities under sec2 tion 123 of such Act, or 

3 ‘‘(V) adult education and literacy 

4 activities, as defined in section 203 of 

5 the Adult Education and Family Lit6 eracy Act (29 U.S.C. 3272), that are 

7 provided by eligible providers of adult 

8 education and literacy activities under 

9 section 231 of such Act (29 U.S.C. 

10 3321), 

11 ‘‘(B) expenses for transportation required 

12 for or provided by any of the services or activi13 ties described in subparagraph (A), 

14 ‘‘(C) expenses for testing necessary for en15 rollment in, or certification in connection with, 

16 services or activities described in subparagraph 

17 (A), or 

18 ‘‘(D) expenses for the purchase of any 

19 computer technology or equipment (as defined 

20 in section 170(e)(6)(F)(i)) or internet access 

21 and related services, if such technology, equip22 ment, or services are to be used by the bene23 ficiary for services or activities described in sub24 paragraph (A) during any of the years the ben25 eficiary is participating in or enrolled in any of 


pamtmann on DSKBFK8HB2PROD with BILLS
9 

•HR 898 IH

1 the services or activities described in subpara2 graph (A).’’. 

3 (c) MODIFICATION OF RULES RELATING TO AGE RE4 STRICTIONS AND CONTRIBUTIONS.— 

5 (1) $10,000 ACCOUNT LIMIT AFTER AGE 30.— 

6 (A) IN GENERAL.—Subparagraph (E) of 

7 section 530(b)(1) of the Internal Revenue Code 

8 of 1986 is amended by inserting ‘‘in excess of 

9 $10,000’’ after ‘‘any balance to the credit of 

10 the designated beneficiary’’. 

11 (B) CONTRIBUTION LIMIT.—Paragraph (1) 

12 of section 530(b)(1) of such Code is amended 

13 by striking ‘‘or’’ at the end of clause (ii), by 

14 striking the period at the end of clause (iii) and 

15 inserting ‘‘, or’’, and by adding at the end the 

16 following new clause: 

17 ‘‘(iv) in the case of a beneficiary who 

18 is over the age of 30, if such contribution 

19 would result in the balance of the account 

20 exceeding $10,000.’’. 

21 (2) INCREASED AGE LIMIT FOR CONTRIBU22 TIONS.—Clause (ii) of section 530(b)(1)(A) of the 

23 Internal Revenue Code of 1986 is amended by strik24 ing ‘‘age 18’’ and inserting ‘‘age 70’’. 


pamtmann on DSKBFK8HB2PROD with BILLS
10 

•HR 898 IH

1 (3) INCREASED CONTRIBUTION LIMITATION

2 FOR INDIVIDUALS OVER AGE 30.— 

3 (A) IN GENERAL.—Section 

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

5 of 1986 is amended by inserting ‘‘($4,000 in 

6 the case of an account the designated bene7 ficiary of which has attained age of 30 before 

8 the end of the taxable year)’’ after ‘‘$2,000’’. 

9 (B) CONFORMING AMENDMENT.—Section 

10 4973(e)(1)(A) of such Code is amended by 

11 striking ‘‘$2,000’’ and inserting ‘‘the limitation 

12 applicable under section 530(b)(1)(A)(iii)’’. 

13 (4) NO CHANGE IN BENEFICIARY AFTER AGE

14 30.—Paragraph (6) of section 530(d) of the Internal 

15 Revenue Code of 1986 is amended by striking ‘‘shall 

16 not be treated as a distribution for purposes of para17 graph (1) if the new beneficiary’’ and inserting 

18 ‘‘shall not be treated as a distribution for purposes 

19 of paragraph (1) if— 

20 ‘‘(A) the old beneficiary has not attained 

21 age 30 before the date of the change in bene22 ficiary, and 

23 ‘‘(B) the new beneficiary’’. 

24 (d) CREDIT FOR EMPLOYER CONTRIBUTIONS.— 


pamtmann on DSKBFK8HB2PROD with BILLS
11 

•HR 898 IH

1 (1) IN GENERAL.—Subpart D of part IV of 

2 subchapter A of chapter 1 of the Internal Revenue 

3 Code of 1986 is amended by adding at the end the 

4 following new section: 

5 ‘‘SEC. 45T. EMPLOYEE EDUCATIONAL SKILLS AND DEVEL6 OPMENT EXPENSES. 

7 ‘‘(a) GENERAL RULE.—For purposes of section 38, 

8 the employee educational skills and development contribu9 tion credit determined under this section for any taxable 

10 year is 25 percent of the nonelective contributions made 

11 by the taxpayer during the taxable year to a Coverdell life12 long learning account (as defined in section 530(b)) the 

13 designated beneficiary of which is an employee of the tax14 payer. 

15 ‘‘(b) SPECIAL RULES AND DEFINITIONS.—For pur16 poses of this section— 

17 ‘‘(1) EMPLOYEE.— 

18 ‘‘(A) CERTAIN EMPLOYEES EXCLUDED.— 

19 The term ‘employee’ shall not include— 

20 ‘‘(i) an employee within the meaning 

21 of section 401(c)(1), 

22 ‘‘(ii) any 2-percent shareholder (as de23 fined in section 1372(b)) of an S corpora24 tion, 


pamtmann on DSKBFK8HB2PROD with BILLS
12 

•HR 898 IH

1 ‘‘(iii) any 5-percent owner (as defined 

2 in section 416(i)(1)(B)(i)) of taxpayer, or 

3 ‘‘(iv) any individual who bears any of 

4 the relationships described in subpara5 graphs (A) through (G) of section 

6 152(d)(2) to, or is a dependent described 

7 in section 152(d)(2)(H) of, an individual 

8 described in clause (i), (ii), or (iii). 

9 ‘‘(B) LEASED EMPLOYEES.—The term 

10 ‘employee’ shall include a leased employee with11 in the meaning of section 414(n). 

12 ‘‘(2) NONELECTIVE CONTRIBUTION.—The term 

13 ‘nonelective contribution’ means an employer con14 tribution other than an employer contribution pursu15 ant to a salary reduction arrangement. 

16 ‘‘(3) AGGREGATION AND OTHER RULES MADE

17 APPLICABLE.— 

18 ‘‘(A) AGGREGATION RULES.—All employ19 ers treated as a single employer under sub20 section (b), (c), (m), or (o) of section 414 shall 

21 be treated as a single employer for purposes of 

22 this section. 

23 ‘‘(B) OTHER RULES.—Rules similar to the 

24 rules of subsections (c), (d), and (e) of section 

25 52 shall apply.’’. 


pamtmann on DSKBFK8HB2PROD with BILLS
13 

•HR 898 IH

1 (2) CREDIT TREATED AS PART OF GENERAL

2 BUSINESS CREDIT.—Section 38(b) of such Code is 

3 amended by striking ‘‘plus’’ at the end of paragraph 

4 (31), by striking the period at the end of paragraph 

5 (32) and inserting ‘‘, plus’’, and by adding at the 

6 end the following new paragraph: 

7 ‘‘(33) the employee educational skills and devel8 opment contribution credit determined under section 

9 45T(a).’’. 

10 (3) CLERICAL AMENDMENT.—The table of sec11 tions for subpart D of part IV of subchapter A of 

12 chapter 1 of such Code is amended by adding at the 

13 end the following new item: 

‘‘Sec. 45T. Employee educational skills and development expenses.’’. 

14 (e) ALLOWANCE OF DEDUCTION FOR BENE15 FICIARY.— 

16 (1) IN GENERAL.—Part VIII of subchapter B 

17 of chapter 1 of the Internal Revenue Code of 1986 

18 is amended by redesignating section 224 as section 

19 225 and by inserting after section 223 the following 

20 new section: 

21 ‘‘SEC. 224. COVERDELL LIFELONG LEARNING ACCOUNT 

22 CONTRIBUTIONS. 

23 ‘‘(a) IN GENERAL.—In the case of an individual 

24 who— 


pamtmann on DSKBFK8HB2PROD with BILLS
14 

•HR 898 IH

1 ‘‘(1) is the designated beneficiary of a Coverdell 

2 lifelong learning account (as defined in section 

3 530(b)(1)), and 

4 ‘‘(2) has attained the age of 18 before the close 

5 of the taxable year, 

6 there shall be allowed as a deduction an amount equal to 

7 the contributions for the taxable year by or on behalf of 

8 such individual to the account described in paragraph (1). 

9 ‘‘(b) RECONTRIBUTED AMOUNTS.—No deduction 

10 shall be allowed under this section with respect to a roll11 over contribution described in section 530(d)(5).’’. 

12 (2) INCREASE IN ADDITIONAL TAX.— 

13 (A) INCREASE.— 

14 (i) IN GENERAL.—Section 

15 530(d)(4)(A) of the Internal Revenue Code 

16 of 1986 is amended by striking ‘‘10 per17 cent’’ and inserting ‘‘20 percent’’. 

18 (ii) CONFORMING AMENDMENT.—Sec19 tion 529(c)(6) of such Code is amended by 

20 inserting ‘‘, except that ‘10 percent’ shall 

21 be substituted for ‘20 percent’ in subpara22 graph (A) thereof’’ before the period at the 

23 end of the first sentence. 

24 (B) MODIFICATION OF TAX TREATMENT

25 OF DEDUCTIBLE CONTRIBUTIONS.—Paragraph 


pamtmann on DSKBFK8HB2PROD with BILLS
15 

•HR 898 IH

1 (1) of section 530(d) is amended to read as fol2 lows: 

3 ‘‘(1) INCLUSION IN GROSS INCOME.— 

4 ‘‘(A) IN GENERAL.—Any distribution shall 

5 be includible in the gross income of the dis6 tributee as follows: 

7 ‘‘(i) So much of the distribution as is 

8 equal to or less than the deductible amount 

9 shall be fully included in gross income. 

10 ‘‘(ii) So much of the distribution 

11 which exceeds the deductible amount shall 

12 be included in gross income in the manner 

13 as provided in section 72 (determined by 

14 applying such section without regard to 

15 any amounts to which clause (i) applies). 

16 ‘‘(B) DEDUCTIBLE AMOUNT.—For pur17 poses of this paragraph, the term ‘deductible 

18 amount’ means the excess of— 

19 ‘‘(i) the sum of contributions to the 

20 account for which a deduction was allowed 

21 under section 224 in such year and any 

22 preceding taxable year, over 

23 ‘‘(ii) the amount of distributions to 

24 which subparagraph (A)(i) applied to in 

25 any preceding taxable year.’’. 


pamtmann on DSKBFK8HB2PROD with BILLS
16 

•HR 898 IH

1 (3) CLERICAL AMENDMENT.—The table of sec2 tions for part VIII of subchapter B of chapter 1 of 

3 such Code is amended by redesignating the item re4 lating to section 224 as relating to section 225 and 

5 by inserting after the item relating to section 223 

6 the following new item: 

‘‘Sec. 224. Coverdell lifelong learning account contributions.’’. 

7 (f) EFFECTIVE DATE.— 

8 (1) IN GENERAL.—Except as otherwise pro9 vided in this subsection, the amendments made by 

10 this section shall take effect on January 1, 2019. 

11 (2) ELIGIBLE EXPENSES.—The amendments 

12 made by subsection (b) shall apply to distributions 

13 made after December 31, 2019. 

14 (3) CONTRIBUTIONS.—The amendments made 

15 by paragraphs (1)(B) and (2) of subsection (c) shall 

16 apply to contributions made after December 31, 

17 2019. 

18 (4) EMPLOYER CONTRIBUTION CREDIT AND

19 BENEFICIARY DEDUCTIONS.—The amendments 

20 made by subsections (d) and (e) shall apply to tax21 able years beginning after December 31, 2019. 

Æ 


pamtmann on DSKBFK8HB2PROD with BILLS