IB 
Union Calendar No. 17 
114TH CONGRESS 
1ST SESSION 
H. R. 529 
[Report No. 114–25] 
To amend the Internal Revenue Code of 1986 to improve 529 plans. 
IN THE HOUSE OF REPRESENTATIVES 
JANUARY 26, 2015 
Ms. JENKINS of Kansas (for herself and Mr. KIND) introduced the following 
bill; which was referred to the Committee on Ways and Means 
FEBRUARY 20, 2015 
Additional sponsors: Mr. PAULSEN, Mr. GIBSON, Mr. KELLY of Pennsylvania, 
Mr. STUTZMAN, Mr. COOK, Mr. FITZPATRICK, Mr. MARCHANT, Mr. 
POLIQUIN, Mr. HUIZENGA of Michigan, Mr. BYRNE, Mr. AMODEI, Mr. 
BENISHEK, Mr. KLINE, Mr. YOUNG of Indiana, Mr. GOODLATTE, Mr. 
MEEHAN, Mr. WESTERMAN, Mr. PETERS, Mr. HILL, Ms. GRAHAM, Ms. 
KUSTER, Mr. FORBES, Mr. HECK of Nevada, Mr. BERA, Mr. POE of 
Texas, Mr. NUNES, Mr. BLUM, Mr. CONNOLLY, Mr. FINCHER, Mr. ROS-
KAM, Mr. SAM JOHNSON of Texas, Mr. GROTHMAN, Mr. LATTA, Mr. 
THOMPSON of California, Mr. SESSIONS, Mr. HIMES, and Mr. SMITH of 
Missouri 
FEBRUARY 20, 2015 
Reported with an amendment, committed to the Committee of the Whole 
House on the State of the Union, and ordered to be printed 
[Strike out all after the enacting clause and insert the part printed in italic] 
[For text of introduced bill, see copy of bill as introduced on January 26, 2015] 
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A BILL 
To amend the Internal Revenue Code of 1986 to improve 
529 plans. 
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Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. FINDINGS AND PURPOSE. 
(a) FINDINGS.—Congress finds the following: 
(1) When the Economic Growth and Tax Relief 
Reconciliation Act of 2001 became law, the tax treat-
ment of section 529 college savings plans was changed 
so that qualified distributions were no longer taxed as 
income. The favorable tax treatment of college savings 
plans was made permanent with the passage of the 
Pension Protection Act of 2006. 
(2) Section 529 college savings plans empower 
middle-class families to accumulate savings to offset 
the rising costs of attending college. 
(3) The latest data from the College Savings 
Plan Network shows that there are 11.83 million 529 
accounts open throughout all 50 states, which rep-
resent $244.5 billion in total assets. The average 529 
account size is $20,671. 
(4) States that sponsor 529 college savings plans 
have taken steps to ensure these plans are a tool that 
all families can use to save for college, including set-
ting minimum contributions as low as $25 per month 
to encourage participation by families of all income 
levels. 
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(5) The President’s fiscal year 2016 Budget pro-
poses raising taxes by taxing certain future distribu-
tions made from 529 college savings plans. 
(6) The tax proposed by the President would dis-
courage the use of 529 college savings plans, requiring 
families and students to take on more debt. 
(7) Purchase of a computer represents a signifi-
cant higher education expense and therefore should be 
eligible for qualified distributions under 529 college 
savings plans. 
(b) PURPOSE.—It is the purpose of this Act to— 
(1) enact policies that strengthen 529 college sav-
ings plans, and 
(2) make 529 plans more modern, consumer- 
friendly, and responsive to the realities faced by stu-
dents today. 
SEC. 2. COMPUTER TECHNOLOGY AND EQUIPMENT PERMA-
NENTLY ALLOWED AS A QUALIFIED HIGHER 
EDUCATION EXPENSE FOR SECTION 529 AC-
COUNTS. 
(a) IN GENERAL.—Section 529(e)(3)(A)(iii) of the In-
ternal Revenue Code of 1986 is amended to read as follows: 
‘‘(iii) expenses for the purchase of com-
puter or peripheral equipment (as defined 
in section 168(i)(2)(B)), computer software 
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(as defined in section 197(e)(3)(B)), or 
Internet access and related services, if such 
equipment, software, or services are to be 
used primarily by the beneficiary during 
any of the years the beneficiary is enrolled 
at an eligible educational institution.’’. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to taxable years beginning after Decem-
ber 31, 2014. 
SEC. 3. ELIMINATION OF DISTRIBUTION AGGREGATION RE-
QUIREMENTS. 
(a) IN GENERAL.—Section 529(c)(3) of the Internal 
Revenue Code of 1986 is amended by striking subparagraph 
(D). 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to distributions after December 31, 2014. 
SEC. 4. RECONTRIBUTION OF REFUNDED AMOUNTS. 
(a) IN GENERAL.—Section 529(c)(3) of the Internal 
Revenue Code of 1986, as amended by section 3, is amended 
by adding at the end the following new subparagraph: 
‘‘(D) SPECIAL
RULE
FOR
CONTRIBUTIONS 
OF REFUNDED AMOUNTS.—In the case of a bene-
ficiary who receives a refund of any qualified 
higher education expenses from an eligible edu-
cational institution, subparagraph (A) shall not 
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apply to that portion of any distribution for the 
taxable year which is recontributed to a qualified 
tuition program of which such individual is a 
beneficiary, but only to the extent such recon-
tribution is made not later than 60 days after 
the date of such refund and does not exceed the 
refunded amount.’’. 
(b) EFFECTIVE DATE.— 
(1) IN GENERAL.—The amendment made by this 
section shall apply with respect to refunds of qualified 
higher education expenses after December 31, 2014. 
(2) TRANSITION RULE.—In the case of a refund 
of qualified higher education expenses received after 
December 31, 2014, and before the date of the enact-
ment of this Act, section 529(c)(3)(D) of the Internal 
Revenue Code of 1986 (as added by this section) shall 
be applied by substituting ‘‘not later than 60 days 
after the date of the enactment of this subparagraph’’ 
for ‘‘not later than 60 days after the date of such re-
fund’’. 
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Union Calendar No. 17 
114TH CONGRESS 
1ST SESSION 
H. R. 529 
[Report No. 114–25] 
A BILL 
To amend the Internal Revenue Code of 1986 to 
improve 529 plans. 
FEBRUARY 20, 2015 
Reported with an amendment, committed to the Com-
mittee of the Whole House on the State of the Union, 
and ordered to be printed 
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19:07 Feb 20, 2015
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