I 

113TH CONGRESS 

1ST SESSION H. R. 529 

To amend the Internal Revenue Code of 1986 to allow certain individuals 

a credit against income tax for contributions to 529 plans, and for 

other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 6, 2013 

Ms. JENKINS (for herself and Mr. KIND) 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 certain individuals a credit against income tax for contributions to 529 plans, 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 ‘‘Savings Enhancement 

5 for Education in College 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 


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

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

3 paragraph: 

4 ‘‘(2) CONTRIBUTIONS TO QUALIFIED TUITION

5 PROGRAMS.— 

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

7 savings contribution’ includes the amount of 

8 any purchase or contribution described in para9 graph (1)(A) of section 529(b) to a qualified 

10 tuition program (as defined in such section) 

11 if— 

12 ‘‘(i) the taxpayer has the power to au13 thorize distributions and otherwise admin14 ister the account, and 

15 ‘‘(ii) the designated beneficiary of 

16 such purchase or contribution is the tax17 payer, the taxpayer’s spouse, or an indi18 vidual with respect to whom the taxpayer 

19 is allowed a deduction under section 151. 

20 ‘‘(B) LIMITATION BASED ON COMPENSA21 TION.—The amount treated as a qualified sav22 ings contribution by reason of subparagraph 

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

24 sum of— 


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

2 section 219(f)(1)) includible in the tax3 payer’s gross income for the taxable year, 

4 and 

5 ‘‘(ii) the amount excluded from the 

6 taxpayer’s gross income under section 112 

7 (relating to combat pay) for such year. 

8 ‘‘(C) DETERMINATION OF ADJUSTED

9 GROSS INCOME.—Solely for purposes of deter10 mining the applicable percentage under sub11 section (b) which applies with respect to the 

12 amount treated as a qualified savings contribu13 tion by reason of subparagraph (A), adjusted 

14 gross income (determined without regard to this 

15 subparagraph) shall be increased by the excess 

16 (if any) of— 

17 ‘‘(i) the social security benefits re18 ceived during the taxable year (within the 

19 meaning of section 86), over 

20 ‘‘(ii) the amount included in gross in21 come for such year under section 86.’’. 

22 (b) CONFORMING AMENDMENTS.— 

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

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


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1 appears in the text and inserting ‘‘qualified sav2 ings’’. 

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

4 of such Code is amended by striking ‘‘RETIRE5 MENT’’. 

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

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

8 amended— 

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

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

11 or (2)’’, and 

12 (B) by striking ‘‘paragraph (1)’’ the sec13 ond place it appears and inserting ‘‘paragraph 

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

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

16 is amended by striking ‘‘AND IRA CONTRIBU17 TIONS’’ and inserting ‘‘, IRA CONTRIBUTIONS, 

18 AND QUALIFIED TUITION PROGRAM CONTRIBU19 TIONS’’. 

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

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

22 amended by striking the item relating to section 25B 

23 and inserting the following new item: 

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

contributions by certain individuals.’’. 


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

2 this section shall apply to contributions made after De3 cember 31, 2012, in taxable years ending after such date. 

4 SEC. 3. EXCLUSION FROM GROSS INCOME FOR EMPLOYER 

5 CONTRIBUTIONS TO QUALIFIED TUITION 

6 PROGRAMS. 

7 (a) IN GENERAL.—Part III of subchapter B of chap8 ter 1 of the Internal Revenue Code of 1986 (relating to 

9 items specifically excluded from gross income) is amended 

10 by inserting after section 127 the following new section: 

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

12 TUITION PROGRAMS. 

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

14 does not include amounts paid by the employer as con15 tributions to a qualified tuition program held by the em16 ployee or spouse of the employee if the contributions are 

17 made pursuant to a program which is described in sub18 section (b). 

19 ‘‘(b) MAXIMUM EXCLUSION.—The amount excluded 

20 from the gross income of an employee under this section 

21 for the taxable year shall not exceed $600. 

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

23 For purposes of this section, a qualified tuition assistance 

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

25 benefit of such employer’s employees— 


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

2 contributions to qualified tuition programs of— 

3 ‘‘(A) such employees, 

4 ‘‘(B) their spouses, or 

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

6 such an employee or spouse— 

7 ‘‘(i) is allowed a deduction under sec8 tion 151, and 

9 ‘‘(ii) has the power to authorize dis10 tributions and otherwise administer such 

11 individual’s account under the qualified 

12 tuition program, and 

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

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

15 (6) of section 127(b). 

16 ‘‘(d) DEFINITIONS AND SPECIAL RULES.—For pur17 poses of this section— 

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

19 ‘qualified tuition program’ means a qualified tuition 

20 program as defined in section 529(b). 

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

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

23 given such terms by paragraphs (2) and (3), respec24 tively, of section 127(c). 


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

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

3 127(c) shall apply. 

4 ‘‘(e) INFLATION ADJUSTMENT.— 

5 ‘‘(1) IN GENERAL.—In the case of any taxable 

6 year beginning in a calendar year after 2013, the 

7 $600 amount contained in subsection (b)(1) shall be 

8 increased by an amount equal to— 

9 ‘‘(A) such dollar amount, multiplied by 

10 ‘‘(B) the cost-of-living adjustment deter11 mined under section 1(f)(3) for the calendar 

12 year in which the taxable year begins, deter13 mined by substituting ‘calendar year 2012’ for 

14 ‘calendar year 1992’ in subparagraph (B) 

15 thereof. 

16 Any increase determined under the preceding sen17 tence shall be rounded to the nearest multiple of 

18 $50. 

19 ‘‘(f) CROSS REFERENCE.—For reporting and record20 keeping requirements, see section 6039D.’’. 

21 (b) EXCLUSION FROM EMPLOYMENT TAXES.— 

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

23 3401(a)(18) of such Code are each amended by in24 serting ‘‘127A,’’ after ‘‘127,’’ each place it appears. 


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

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

3 or 127A’’. 

4 (c) REPORTING AND RECORDKEEPING REQUIRE5 MENTS.—Section 6039D(d)(1) of such Code is amended 

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

7 (d) OTHER CONFORMING AMENDMENTS.— 

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

9 414(t)(2) of such Code are each amended by insert10 ing ‘‘127A,’’ after ‘‘127,’’ each place it appears. 

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

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

13 or 127A’’. 

14 (3) Section 1397(a)(2)(A) of such Code is 

15 amended by inserting at the end the following new 

16 clause: 

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

18 an employer which is excludable from the 

19 gross income of an employee under section 

20 127A, but only to the extent paid or in21 curred to a person not related to the em22 ployer.’’. 

23 (4) Section 209(a)(15) of the Social Security 

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

25 ‘‘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 the date of the enactment of this Act. 

Æ 


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