Additionally, the bill would add a new category of qualifying expenses to include job training expenses, A beneficiary may withdraw funds for tuition, fees, books supplies and equipment required for training programs. Under current law, when students and their families use an ESA to save for higher education, they incur a tax penalty when they remove the funds. My bill removes all tax penalties from these accounts. The Education for Life Act also increases the beneficiary age limit for contributions from 18 to 55 because the need for job training assistance has no age limit. The Tuition Account Assistance Act would enable private colleges to offer the same prepaid tuition plans currently offered by many states.
Many states offer savings plans for families wanting to save for the future expenses of a child.
Students can withdraw these funds, but only for use at state colleges and universities in their home state - limiting the usefulness and appeal of these programs. Higher education expenses impose a great financial burden for most families and working students. My bill will expand this savings opportunity by eliminating the tax penalty road block that hit families and students. Included in the English education package is the Student Loan Interest Deduction Act. This bill would allow student loan interest to be fully tax deductible and apply to all graduate and undergraduate loans.