Upward Mobility Enhancement Act
Bill: H.R.4428 | Sponsor: Rep. Smith, Jason (R-MO)
Policy area: Taxation

Summary:
Upward Mobility Enhancement Act
This bill increases the amount of the tax exclusion for employer-paid educational assistance programs. It also expands the exclusion to include amounts paid for education-related tools and technology (e.g., hand tools, computers, software, licensure fees).

To amend the Internal Revenue Code of 1986 to increase the exclusion 
  for educational assistance programs and to allow the exclusion with 
           respect to education-related tools and technology.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Upward Mobility Enhancement Act''.

SEC. 2. INCREASE IN EXCLUSION FOR EDUCATIONAL ASSISTANCE PROGRAMS.

    (a) In General.--Section 127(a)(2) of the Internal Revenue Code of 
1986 is amended to read as follows:
            ``(2) Maximum exclusion.--
                    ``(A) In general.--This section shall apply only to 
                the first $12,000 of educational assistance furnished 
                to an individual during a calendar year, in the case of 
                assistance for education below the graduate level.
                    ``(B) Inflation adjustment.--In the case of any 
                calendar year after 2021, the dollar amount in 
                subparagraph (A) shall be increased by an amount equal 
                to--
                            ``(i) such dollar amount, multiplied by
                            ``(ii) the cost-of-living adjustment 
                        determined under section 1(f)(3) for the 
                        calendar year in which such taxable year begins 
                        by substituting `calendar year 2020' for 
                        `calendar year 2016' in subparagraph (A)(ii) 
                        thereof.
                If any increase determined under this subparagraph is 
                not a multiple of $50, such increase shall be rounded 
                to the next lowest multiple of $50.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after December 31, 2020.

SEC. 3. EXPENSES FOR EDUCATION-RELATED TOOLS AND TECHNOLOGY.

    (a) In General.--Section 127(c)(1) of the Internal Revenue Code of 
1986 is amended by striking ``equipment'' both places it appears in 
subparagraphs (A) and (C) thereof and inserting ``education-related 
tools and technology and other equipment''.
    (b) Education-Related Tools and Technology.--Section 127(c) of such 
Code is amended by adding at the end the following new paragraph:
            ``(8) Education-related tools and technology.--For purposes 
        of paragraph (1), the term `education-related tools and 
        technology' includes any--
                    ``(A) hand tools and construction equipment,
                    ``(B) computer or peripheral equipment (as defined 
                in section 168(i)(2)(B)),
                    ``(C) computer software (as defined in section 
                197(e)(3)(B)),
                    ``(D) Internet access and related services 
                (including equipment or technology necessary for 
                Internet access),
                    ``(E) Internet, mobile, or virtual reality learning 
                tools and technology,
                    ``(F) licensure fees, materials, or other 
                equipment, and
                    ``(G) any other tools or technology as determined 
                by the Secretary,
        provided to an employee which is required for the education of 
        the employee or in connection with a course of instruction for 
        the employee, or is required in order for the employee to 
        obtain professional advancement, to obtain any certification, 
        licensure, or employment under any State, regional or national 
        guidelines or regulations applicable to a trade or other 
        skilled profession, or to maintain such a certification, 
        licensure, or employment through a continuing education 
        program.''
    (c) Employee Retention of Education-Related Tools and Technology.--
Section 127(c)(1) of such Code is amended by striking ``completion of a 
course of instruction,'' and inserting ``completion of a course of 
instruction (other than education-related tools and technology not 
described in paragraph (8)(D)),''.
    (d) Effective Date.--The amendments made by this section shall 
apply to amounts paid or incurred on or after the first day of the 
calendar quarter which includes the date of the enactment of this Act.
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