(i) IN
GENERAL.—Subsection (a) of 
section 4973 of the Internal Revenue Code 
of 1986 is amended by striking ‘‘or’’ at the 
end of paragraph (4), by inserting ‘‘or’’ at 
the end of paragraph (5), and by inserting 
after paragraph (5) the following new 
paragraph: 
‘‘(6) an ABLE account (within the meaning of 
section 530A),’’. 
(ii) EXCESS
CONTRIBUTIONS.—Sec-
tion 4973 of such Code is amended by add-
ing at the end the following new sub-
section: 
‘‘(h) EXCESS
CONTRIBUTIONS
TO
ABLE AC-
COUNTS.—For purposes of this section, in the case of an 
ABLE account (within the meaning of section 530A), the 
term ‘excess contributions’ means the sum of— 
‘‘(1) the amount by which the sum of the 
amount contributed for the taxable year to such ac-
counts plus such amounts contributed for all pre-
ceding taxable years exceeds the amount described in 
section 530A(b)(1)(A)(ii), and 
‘‘(2) the amount determined under this section 
for the preceding taxable year, reduced by the dis-
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tributions from such account which were includible 
in gross income under section 530A(c)(1). 
For purposes of this section, an amount which is distrib-
uted out of an ABLE account in a distribution to which 
section 530A(c)(3)(C) applies shall be treated as an 
amount not contributed.’’. 
(B) 
TAX
ON
PROHIBITED
TRANS-
ACTIONS.— 
(i) IN
GENERAL.—Paragraph (1) of 
section 4975(e) of such Code (defining 
plan) is amended by redesignating sub-
paragraph (G) as subparagraph (H), by 
striking ‘‘or’’ at the end of subparagraph 
(F), and by adding after subparagraph (F) 
the following: 
‘‘(G) an ABLE account described in sec-
tion 530A, or’’. 
(ii) EXEMPTION.—Subsection (d) of 
section 4975 of such Code (relating to ex-
emptions) is amended by striking ‘‘or’’ at 
the end of paragraph (22), by striking the 
period at the end of paragraph (23) and 
inserting ‘‘; or’’, and by inserting after 
paragraph (23) the following: 
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‘‘(24) in the case of an ABLE account, any 
transaction to provide housing or other services by 
a family member to or for the designated beneficiary 
of the trust to the extent that such transaction does 
not exceed the fair market value of the housing or 
service (as the case may be) provided.’’. 
(iii) SPECIAL
RULE.—Subsection (c) 
of section 4975 of such Code (relating to 
tax on prohibited transactions) is amended 
by adding at the end the following new 
paragraph: 
‘‘(7) SPECIAL RULE FOR ABLE ACCOUNTS.—An 
individual for whose benefit an ABLE account is es-
tablished and any contributor to such account shall 
be exempt from the tax imposed by this section with 
respect to any transaction concerning such account 
(which would otherwise be taxable under this sec-
tion) if section 530A(d) applies with respect to such 
transaction.’’. 
(C) ROLLOVERS
FROM
CERTAIN
OTHER 
TAX FAVORED ACCOUNTS.— 
(i) QUALIFIED TUITION PROGRAMS.— 
Paragraph (3) of section 529(c) of such 
Code is amended by adding at the end the 
following new subparagraph: 
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‘‘(E) 
CONTRIBUTIONS
TO
ABLE
AC-
COUNT.—Subparagraph (A) shall not apply to 
that portion of any distribution which, within 
60 days of such distribution, is contributed to 
an ABLE account for the benefit of the des-
ignated beneficiary.’’. 
(ii) 
EDUCATION
SAVINGS
AC-
COUNTS.—Subsection (d) of section 530 of 
such Code is amended by adding at the 
end the following new paragraph: 
‘‘(10) CONTRIBUTIONS
TO
ABLE
ACCOUNT.— 
Paragraph (1) shall not apply to any amount paid 
or distributed from a Coverdell education savings ac-
count to the extent that the amount received is paid, 
not later than the 60th day after the date of such 
payment or distribution, into an ABLE account for 
the benefit of the same beneficiary.’’. 
(iii) HEALTH
SAVINGS
ACCOUNTS.— 
Subparagraph (A) of section 223(f)(5) is 
amended— 
(I) by inserting ‘‘(i)’’ before ‘‘into 
a health savings account’’, and 
(II) by inserting ‘‘or (ii) into an 
ABLE account for the benefit of such 
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beneficiary’’ before ‘‘not later than the 
60th day’’. 
(iv) CERTAIN
IRAS.—Subparagraph 
(A) of section 408(d)(3) is amended by 
striking ‘‘or’’ at the end of clause (i), by 
striking the period at the end of clause (ii) 
and inserting ‘‘; or’’, and by inserting after 
clause (ii) the following new clause: 
‘‘(iii) the entire amount received (in-
cluding money and other property) is paid 
into an ABLE account for the benefit of 
the child or grandchild of such individual 
not later than the 60th day after the day 
on which the payment or distribution is re-
ceived.’’. 
(D) REPORTS.—Paragraph (2) of section 
6693(a) of such Code is amended by striking 
‘‘and’’ at the end of subparagraph (D), by 
striking the period at the end of subparagraph 
(E) and inserting ‘‘and’’, and by inserting after 
subparagraph (E) the following new subpara-
graph: 
‘‘(F) section 530A(g) (relating to ABLE 
accounts).’’. 
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