(A) by striking subsection (h), and 
(B) by redesignating subsections (d), (e), 
(f), (g), and (i) as subsections (c), (d), (e), (f), 
and (g), respectively. 
(2) Subsection (f)(2) of section 25A of such 
Code, as so redesignated, is amended by striking 
‘‘(before the application of subsections (b), (c), and 
(d))’’. 
(c) OTHER CONFORMING AND CLERICAL AMEND-
MENTS.— 
(1) The following provisions of such Code are 
each amended by striking ‘‘section 25A(g)(2)’’ and 
inserting ‘‘section 25A(f)(2)’’: 
(A) Section 72(t)(7)(B). 
(B) Section 221(d)(2)(B). 
(C) Section 222(d)(1) (as amended by sec-
tion 132 of this Act). 
(D) Section 529(c)(3)(B)(v)(I). 
(E) Section 530(b)(2)(A). 
(F) Section 530(d)(2)(C)(i)(I). 
(G) Section 530(d)(4)(B)(iii). 
(2) Section 221(d) of such Code is amended— 
(A) in paragraph (2) by striking ‘‘section 
25A(f)(2)’’ and inserting ‘‘section 25A(e)(2)’’, 
and
(B) by amending paragraph (3) to read as 
follows: 
‘‘(3) ELIGIBLE STUDENT.—The term ‘eligible 
student’ means, with respect to any academic period, 
a student who— 
‘‘(A) meets the requirements of section 
484(a)(1) of the Higher Education Act of 1965 
(20 U.S.C. 1091(a)(1)), as in effect on the date 
of the enactment of this section, and 
‘‘(B) is carrying at least 1⁄2 the normal 
full-time work load for the course of study the 
student is pursuing.’’. 
(3) Section 529(e)(3)(B)(i) of such Code is 
amended by striking ‘‘section 25A(b)(3)’’ and insert-
ing ‘‘section 221(d)(3)’’. 
(4) The heading of section 529(c)(3)(B)(v) of 
such Code is amended to read as follows: ‘‘COORDI-
NATION WITH EDUCATION CREDIT.—’’. 
(5) The heading of section 530(d)(2)(C) of such 
Code is amended to read as follows: ‘‘COORDINATION 
WITH EDUCATION CREDIT AND QUALIFIED TUITION 
PROGRAMS.—’’. 
(6) Section 6050S(e) of such Code is amended 
by striking ‘‘subsection (g)(2)’’ and inserting ‘‘sub-
section (f)(2)’’.
(7) Section 6213(g)(2)(J) of such Code is 
amended by striking ‘‘section 25A(g)(1)’’ and insert-
ing ‘‘section 25A(f)(1)’’. 
(8) The item relating to section 25A in the 
table of sections for subpart A of part IV of sub-
chapter A of chapter 1 of such Code is amended to 
read as follows: 
‘‘Sec. 25A. Education Credit.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2003. 
SEC. 3. UNIFORM DEFINITION OF QUALIFYING HIGHER 
EDUCATION EXPENSES. 
(a) IN GENERAL.—Paragraph (3) of section 529(e) 
of such Code (relating to other definitions and special 
rules) is amended to read as follows: 
‘‘(3) QUALIFIED
HIGHER
EDUCATION
EX-
PENSES.— 
‘‘(A) IN
GENERAL.—The term ‘qualified 
higher education expenses’ means— 
‘‘(i) tuition, fees, books, supplies, and 
equipment required for the enrollment or 
attendance of a designated beneficiary at 
an eligible educational institution; and 
‘‘(ii) expenses for special needs serv-
ices in the case of a special needs bene-
ficiary which are incurred in connection 
with such enrollment or attendance. 
‘‘(B) ROOM
AND
BOARD
INCLUDED
FOR 
STUDENTS WHO ARE AT LEAST HALF-TIME.— 
‘‘(i) IN GENERAL.—In the case of an 
individual who is an eligible student for 
any academic period, such term shall also 
include reasonable costs for such period (as 
determined under the qualified tuition pro-
gram) incurred by the designated bene-
ficiary for room and board while attending 
such institution. For purposes of sub-
section (b)(7), a designated beneficiary 
shall be treated as meeting the require-
ments of this clause. 
‘‘(ii) LIMITATION.—The amount treat-
ed as qualified higher education expenses 
by reason of clause (i) shall not exceed— 
‘‘(I) the allowance (applicable to 
the student) for room and board in-
cluded in the cost of attendance (as 
defined in section 472 of the Higher 
Education Act of 1965 (20 U.S.C. 
1087ll), as in effect on the date of the 
enactment of the Economic Growth
and Tax Relief Reconciliation Act of 
2001) as determined by the eligible 
educational institution for such pe-
riod, or 
‘‘(II) if greater, the actual invoice 
amount the student residing in hous-
ing owned or operated by the eligible 
educational institution is charged by 
such institution for room and board 
costs for such period. 
‘‘(iii) ELIGIBLE STUDENT.—For pur-
poses of this subparagraph, the term ‘eligi-
ble student’ means, with respect to any 
academic period, a student who— 
‘‘(I) meets the requirements of 
section 484(a)(1) of the Higher Edu-
cation Act of 1965 (20 U.S.C. 
1091(a)(1)), as in effect on the date 
of the enactment of this section, and 
‘‘(II) is carrying at least 1⁄2 the 
normal full-time work load for the 
course of study the student is pur-
suing. 
‘‘(C) EXCEPTIONS.—
‘‘(i) EXCEPTION FOR EDUCATION IN-
VOLVING
SPORTS, ETC.—Such term does 
not include expenses with respect to any 
course or other education involving sports, 
games, or hobbies, unless such course or 
other education is part of the individual’s 
degree program. 
‘‘(ii) EXCEPTION FOR NONACADEMIC 
FEES.—Such term does not include stu-
dent activity fees, athletic fees, insurance 
expenses, or other expenses unrelated to an 
individual’s academic course of instruc-
tion.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 25A and 6050S of such Code are 
each amended by striking ‘‘qualified tuition and re-
lated expenses’’ each place it appears and inserting 
‘‘qualified higher education expenses’’. 
(2) Section 25A(e)(1) of such Code (as amend-
ed by this Act) is amended to read as follows: 
‘‘(1) QUALIFIED
HIGHER
EDUCATION
EX-
PENSES.—The term ‘qualified higher education ex-
penses’ means the qualified higher education ex-
penses (as defined by section 529(e)(3) without re-
gard to subparagraph (B) thereof) required for the 
enrollment or attendance of— 
‘‘(A) the taxpayer, 
‘‘(B) the taxpayer’s spouse, or 
‘‘(C) any dependent of the taxpayer with 
respect to whom the taxpayer is allowed a de-
duction under section 151, 
at an eligible educational institution for courses of 
instruction of such individual at such institution.’’. 
(3) Section 135(c)(2) of such Code is amend-
ed— 
(A) by striking ‘‘tuition and fees’’ and in-
serting ‘‘the qualified higher education expenses 
(as defined by section 529(e)(3) without regard 
to subparagraph (B) thereof)’’, and 
(B) by striking subparagraph (B) and re-
designating subparagraph (C) as subparagraph 
(B). 
(4) Section 221(d)(2) of such Code is amended 
by striking ‘‘the cost of attendance (as defined in 
section 472 of the Higher Education Act of 1965, 
20 U.S.C. 1087ll, as in effect on the day before the 
date of the enactment of this Act)’’ and inserting 
‘‘the qualified higher education expenses (as defined
by section 529(e)(3) without regard to subparagraph 
(B) thereof) incurred for attendance’’. 
(5)(A) Section 222 of such Code is amended by 
striking ‘‘qualified tuition and related expenses’’ 
each place it appears and inserting ‘‘qualified higher 
education expenses’’. 
(B) Section 222(d)(1) of such Code is amended 
to read as follows: 
‘‘(1) QUALIFIED
HIGHER
EDUCATION
EX-
PENSES.—The term ‘qualified higher education ex-
penses’ has the meaning given such term by section 
529(e)(3) (without regard to subparagraph (B) 
thereof). Such expenses shall be reduced in the same 
manner as under section 25A(f)(2).’’. 
(C) Section 222(d) of such Code is amended by 
redesignating paragraph (6) as paragraph (7) and 
by inserting after paragraph (5) the following new 
paragraph: 
‘‘(6) ROOM AND BOARD INCLUDED FOR STU-
DENTS WHO ARE FULL-TIME.—No amount shall be 
taken into account under this section for an expense 
described in section 529(e)(3)(B) (relating to room 
and board included for students who are at least 
half-time) unless such individual is an eligible stu-
dent (as defined in section 25A(b)(3), determined by
substituting ‘the normal full-time work load’ in lieu 
of ‘1⁄2 the normal full-time work load’ in subpara-
graph (B) thereof.’’. 
(D) The heading for section 222 of such Code 
is amended by striking ‘‘TUITION AND RE-
LATED’’ 
and 
inserting 
‘‘HIGHER 
EDU-
CATION’’. 
(E) The table of sections for part VII of sub-
chapter B of chapter 1 of such Code is amended by 
amending the item relating to section 222 to read as 
follows: 
‘‘Sec. 222. Qualified higher education expenses.’’. 
(6)(A) Section 6724(d) of such Code is amend-
ed— 
(i) in paragraph (1)(B)(x) by striking 
‘‘qualified tuition and related expenses’’ and in-
serting ‘‘qualified higher education expenses’’, 
and 
(ii) in paragraph (2)(Z) by striking ‘‘quali-
fied tuition and related expenses’’ and inserting 
‘‘qualified higher education expenses’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to amounts paid in taxable years 
beginning after December 31, 2003, for education fur-
nished in periods beginning after such date. 
Æ