I 

114TH CONGRESS 

1ST SESSION H. R. 553 

To amend the Internal Revenue Code of 1986 to encourage the use of 

529 plans and Coverdell education savings accounts, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JANUARY 27, 2015 

Mr. MESSER 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 encourage 

the use of 529 plans and Coverdell education savings 

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. ALLOWANCE OF HOME SCHOOL EXPENSES AS 

4 QUALIFIED EDUCATION EXPENSES FOR PUR5 POSES OF A COVERDELL EDUCATION SAV6 INGS ACCOUNT. 

7 (a) IN GENERAL.—Section 530(b)(3) of the Internal 

8 Revenue Code of 1986 is amended by adding at the end 

9 the following new subparagraph: 


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1 ‘‘(C) PRIVATE SCHOOL.—For purposes of 

2 this section, the term ‘private school’ includes 

3 any home school that meets the requirements of 

4 State law applicable to such home schools, 

5 whether or not such school is deemed a private 

6 school for purposes of State law.’’. 

7 (b) EFFECTIVE DATE.—The amendment made by 

8 this section shall apply to taxable years beginning after 

9 December 31, 2014. 

10 SEC. 2. ELIMINATION OF COVERDELL EDUCATION SAVINGS 

11 ACCOUNT CONTRIBUTION LIMITATION. 

12 (a) IN GENERAL.—Section 530(b)(1)(A) of the Inter13 nal Revenue Code of 1986 is amended by inserting ‘‘or’’ 

14 at the end of clause (i), by striking ‘‘or’’ at the end of 

15 clause (ii) and inserting a period, and by striking clause 

16 (iii). 

17 (b) PROHIBITION ON EXCESS CONTRIBUTIONS.— 

18 Section 530(b) of such Code is amended by adding at the 

19 end the following new paragraph: 

20 ‘‘(5) PROHIBITION ON EXCESS CONTRIBU21 TIONS.—A program shall not be treated as a Cover22 dell education savings account unless it provides 

23 adequate safeguards to prevent contributions on be24 half of a designated beneficiary in excess of those 


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1 necessary to provide for the qualified education ex2 penses of the beneficiary.’’. 

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

4 this section shall apply to taxable years beginning after 

5 December 31, 2014. 

6 SEC. 3. 529 PROGRAMS FOR PRE-KINDERGARTEN, ELEMEN7 TARY, AND SECONDARY EDUCATION EX8 PENSES. 

9 (a) IN GENERAL.—Section 529(e)(3) of the Internal 

10 Revenue Code of 1986 is amended— 

11 (1) by redesignating subparagraph (B) as sub12 paragraph (C); 

13 (2) by striking ‘‘QUALIFIED HIGHER EDU14 CATION EXPENSES’’ and all that follows through 

15 ‘‘The term ‘qualified higher education expenses’ 

16 means—’’ and inserting the following: ‘‘QUALIFIED

17 EDUCATION EXPENSES.— 

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

19 education expenses’ means— 

20 ‘‘(i) qualified higher education ex21 penses, and 

22 ‘‘(ii) qualified pre-kindergarten, ele23 mentary, and secondary education ex24 penses. 


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1 ‘‘(B) QUALIFIED HIGHER EDUCATION EX2 PENSES.—The term ‘qualified higher education 

3 expenses’ means’’; and 

4 (3) by adding at the end the following new sub5 paragraphs: 

6 ‘‘(D) QUALIFIED PRE-KINDERGARTEN, EL7 EMENTARY, AND SECONDARY EDUCATION EX8 PENSES.—The term ‘qualified pre-kindergarten, 

9 elementary, and secondary education expenses’ 

10 means— 

11 ‘‘(i) expenses for tuition, fees, aca12 demic tutoring, special needs services in 

13 the case of a special needs beneficiary, 

14 books, supplies, and other equipment which 

15 are incurred in connection with the enroll16 ment or attendance of the designated bene17 ficiary of the trust as a pre-kindergarten, 

18 elementary, or secondary school student at 

19 a public, private, or religious school, 

20 ‘‘(ii) expenses for room and board, 

21 uniforms, transportation, and supple22 mentary items and services (including ex23 tended day programs) which are required 

24 or provided by a public, private, or reliVerDate Sep 11 2014 02:49 Feb 03, 2015 Jkt 049200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H553.IH H553

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1 gious school in connection with such enroll2 ment or attendance, and 

3 ‘‘(iii) expenses for the purchase of any 

4 computer technology or equipment (as de5 fined in section 170(e)(6)(F)(i)) or Inter6 net access and related services, if such 

7 technology, equipment, or services are to 

8 be used by the beneficiary and the bene9 ficiary’s family during any of the years the 

10 beneficiary is in school. 

11 Clause (iii) shall not include expenses for com12 puter software designed for sports, games, or 

13 hobbies unless the software is predominantly 

14 educational in nature. 

15 ‘‘(E) SCHOOL.—The term ‘school’ means 

16 any school which provides pre-kindergarten, ele17 mentary, or secondary education (pre-kinder18 garten through grade 12), as determined under 

19 State law. Such a school shall be treated as an 

20 eligible educational institution for purposes of 

21 subsection (b).’’. 

22 (b) CONFORMING AMENDMENTS.—Section 529 of 

23 such Code is amended by striking ‘‘qualified higher edu24 cation’’ each place it appears in subsections (b) and (c) 

25 and inserting ‘‘qualified education’’. 


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

2 this section shall apply to taxable years beginning after 

3 December 31, 2014. 

Æ 


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