To amend the Internal Revenue Code of 1986 to improve 529 plans.

Bill: 114-hr-529
Sponsor: full_name: Rep. Jenkins, Lynn [R-KS-2]
Introduced: 2015-01-26
Policy area: Taxation
Subjects: Computers and information technology

Educational technology and distance education

Higher education

Income tax exclusion

Student aid and college costs
Latest action: action_date: 2015-04-16
text: Read twice and referred to the Committee on Finance.

Summaries:
action_date: 2015-01-26
action_desc: Introduced in House
text: <p>This bill amends the Internal Revenue Code, with respect to qualified tuition programs (529 plans), to: (1) make permanent the allowance for payment of computer technology and equipment expenses from a 529 plan if such technology and equipment is to be used primarily by the plan beneficiary (currently, use is allowed by the beneficiary and the beneficiary's family); (2) eliminate the requirement that distributions from a 529 plan be aggregated for purposes of determining the amount includible in a taxpayer's income; and (3) allow a tax-free recontribution to a 529 plan of amounts refunded to a student who withdraws from an educational institution if the recontribution is made not later than 60 days after the date of such refund and does not exceed the refunded amount. </p>

action_date: 2015-02-20
action_desc: Reported to House with amendment(s)
text: <p>This bill makes changes to the rules for qualified tuition programs (known as 529 plans).</p> <p>(Sec. 2) The Internal Revenue Code is amended to allow payments from 529 plans for the purchase of computer or peripheral equipment, computer software, or Internet access and related services to be used primarily by a 529 plan beneficiary while enrolled in an eligible educational institution. </p> <p>(Sec. 3) The requirement that distributions from a 529 plan be aggregated for purposes of determining the amount includible in a taxpayer's income is eliminated. </p> <p>(Sec. 4) Students who receive a refund from an eligible educational institution can recontribute such refund to a 529 plan without tax consequences if the recontribution is made not later than 60 days after the date of such refund and does not exceed the refunded amount.

action_date: 2015-02-25
action_desc: Passed House amended
text: <p>(This measure has not been amended since it was reported to the House on February 20, 2015. The summary of that version is repeated here.)</p> <p>This bill makes changes to the rules for qualified tuition programs (known as 529 plans).</p> <p>(Sec. 2) The Internal Revenue Code is amended to allow payments from 529 plans for the purchase of computer or peripheral equipment, computer software, or Internet access and related services to be used primarily by a 529 plan beneficiary while enrolled in an eligible educational institution. </p> <p>(Sec. 3) The requirement that distributions from a 529 plan be aggregated for purposes of determining the amount includible in a taxpayer's income is eliminated. </p> <p>(Sec. 4) Students who receive a refund from an eligible educational institution can recontribute such refund to a 529 plan without tax consequences if the recontribution is made not later than 60 days after the date of such refund and does not exceed the refunded amount. </p>

tv_txt: I 114th CONGRESS 1st Session H. R. 529 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 A BILL To amend the Internal Revenue Code of 1986 to improve 529 plans.

1. Computer technology and equipment allowed as a qualified higher education expense for section 529 accounts (a) Made permanent Clause (iii) of section 529(e)(3)(A) of the Internal Revenue Code of 1986 is amended by striking in 2009 or 2010 . (b) Only for use primarily by the beneficiary Clause (iii) of section 529(e)(3)(A) of such Code is amended by striking used by the beneficiary and the beneficiary’s family and inserting used primarily by the beneficiary . (c) Effective date The amendments made by this section shall apply to expenses paid or incurred after December 31, 2014. 2. Elimination of distribution aggregation requirements (a) In general Clause (ii) of section 529(c)(3)(D) of the Internal Revenue Code of 1986 is amended by inserting before the comma at the end the following: , except for purposes of calculating the earnings portion of any distribution. . (b) Effective date The amendment made by this section shall apply to distributions after December 31, 2014. 3. Contribution of amounts previously distributed in case of withdrawal from school (a) In general Paragraph (3) of section 529(c) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph: (E) Special rule for contributions relating to withdrawal from school In the case of a beneficiary who receives a refund of any qualified higher education expenses from an eligible educational institution in connection with withdrawal from enrollment at such institution, subparagraph (A) shall not 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 recontribution is made not later than 60 days after the date of such refund and does not exceed the refunded amount. . (b) Effective date The amendment made by this section shall apply with respect to distributions after December 31, 2014.

tv_txt: II 114th CONGRESS 1st Session H. R. 529 IN THE SENATE OF THE UNITED STATES February 26, 2015 Received AN ACT To amend the Internal Revenue Code of 1986 to improve 529 plans.

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 treatment 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 represent $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 setting minimum contributions as low as $25 per month to encourage participation by families of all income levels. (5) The President’s fiscal year 2016 Budget proposes raising taxes by taxing certain future distributions made from 529 college savings plans. (6) The tax proposed by the President would discourage the use of 529 college savings plans, requiring families and students to take on more debt. (7) Purchase of a computer represents a significant 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 savings plans; and (2) make 529 plans more modern, consumer-friendly, and responsive to the realities faced by students today. 2. Computer technology and equipment permanently allowed as a qualified higher education expense for section 529 accounts (a) In general Section 529(e)(3)(A)(iii) of the Internal Revenue Code of 1986 is amended to read as follows: (iii) expenses for the purchase of computer or peripheral equipment (as defined in section 168(i)(2)(B)), computer software (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 December 31, 2014. 3. Elimination of distribution aggregation requirements (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. 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 beneficiary who receives a refund of any qualified higher education expenses from an eligible educational institution, subparagraph (A) shall not 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 recontribution 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 enactment 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 refund .

Passed the House of Representatives February 25, 2015. Karen L. Haas, Clerk

tv_txt: IB 114th CONGRESS 1st Session H. R. 529 IN THE HOUSE OF REPRESENTATIVES AN ACT To amend the Internal Revenue Code of 1986 to improve 529 plans.

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 treatment 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 represent $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 setting minimum contributions as low as $25 per month to encourage participation by families of all income levels. (5) The President’s fiscal year 2016 Budget proposes raising taxes by taxing certain future distributions made from 529 college savings plans. (6) The tax proposed by the President would discourage the use of 529 college savings plans, requiring families and students to take on more debt. (7) Purchase of a computer represents a significant 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 savings plans; and (2) make 529 plans more modern, consumer-friendly, and responsive to the realities faced by students today. 2. Computer technology and equipment permanently allowed as a qualified higher education expense for section 529 accounts (a) In general Section 529(e)(3)(A)(iii) of the Internal Revenue Code of 1986 is amended to read as follows: (iii) expenses for the purchase of computer or peripheral equipment (as defined in section 168(i)(2)(B)), computer software (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 December 31, 2014. 3. Elimination of distribution aggregation requirements (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. 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 beneficiary who receives a refund of any qualified higher education expenses from an eligible educational institution, subparagraph (A) shall not 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 recontribution 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 enactment 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 refund .

Passed the House of Representatives February 25, 2015. Karen L. Haas, Clerk.

tv_txt: IB Union Calendar No. 17 114th CONGRESS 1st Session H. R. 529 [Report No. 114–25] 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. Roskam , 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 A BILL To amend the Internal Revenue Code of 1986 to improve 529 plans.

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 treatment 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 represent $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 setting minimum contributions as low as $25 per month to encourage participation by families of all income levels. (5) The President’s fiscal year 2016 Budget proposes raising taxes by taxing certain future distributions made from 529 college savings plans. (6) The tax proposed by the President would discourage the use of 529 college savings plans, requiring families and students to take on more debt. (7) Purchase of a computer represents a significant 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 savings plans, and (2) make 529 plans more modern, consumer-friendly, and responsive to the realities faced by students today. 2. Computer technology and equipment permanently allowed as a qualified higher education expense for section 529 accounts (a) In general Section 529(e)(3)(A)(iii) of the Internal Revenue Code of 1986 is amended to read as follows: (iii) expenses for the purchase of computer or peripheral equipment (as defined in section 168(i)(2)(B)), computer software (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 December 31, 2014. 3. Elimination of distribution aggregation requirements (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. 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 beneficiary who receives a refund of any qualified higher education expenses from an eligible educational institution, subparagraph (A) shall not 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 recontribution 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 enactment 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 refund .

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

tv_txt: IIB 114th CONGRESS 1st Session H. R. 529 IN THE SENATE OF THE UNITED STATES February 26, 2015 Received April 16, 2015 Read twice and referred to the Committee on Finance AN ACT To amend the Internal Revenue Code of 1986 to improve 529 plans.

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 treatment 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 represent $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 setting minimum contributions as low as $25 per month to encourage participation by families of all income levels. (5) The President’s fiscal year 2016 Budget proposes raising taxes by taxing certain future distributions made from 529 college savings plans. (6) The tax proposed by the President would discourage the use of 529 college savings plans, requiring families and students to take on more debt. (7) Purchase of a computer represents a significant 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 savings plans; and (2) make 529 plans more modern, consumer-friendly, and responsive to the realities faced by students today. 2. Computer technology and equipment permanently allowed as a qualified higher education expense for section 529 accounts (a) In general Section 529(e)(3)(A)(iii) of the Internal Revenue Code of 1986 is amended to read as follows: (iii) expenses for the purchase of computer or peripheral equipment (as defined in section 168(i)(2)(B)), computer software (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 December 31, 2014. 3. Elimination of distribution aggregation requirements (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. 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 beneficiary who receives a refund of any qualified higher education expenses from an eligible educational institution, subparagraph (A) shall not 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 recontribution 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 enactment 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 refund .

Passed the House of Representatives February 25, 2015. Karen L. Haas, Clerk