The way IT manager Terry Schafer remembers it, his pursuit of a superior e-mail and file sharing solution started with a simple question from one of his company's owners. The new tax bill quadruples the contribution level, and expands the accounts to cover education-related expenses for children in kindergarten through 12th grade.
Expenses can include computers, Internet access, educational software and other related items.
A Commerce Department study issued last year found that about 51 percent of U.S. households have computers, while only 41 percent have Internet access. America Online, the largest U.S. online service provider and a big employer in Allen's home state of Virginia, stands to gain from the provision. Parents may be more likely to buy Internet hook-ups and computers if they get tax advantages. Fifty-seven percent went to Republicans, and 43 percent went to Democrats. Separately, Congress dealt the high-tech industry a disappointing setback, stripping out a provision in the final tax package that would have given companies a permanent tax credit for research and development.