H.R. 529 would add new tax incentives to 529 plans

On Feb. 8, 2011, Rep. Lynn Jenkins (R-KS) and Rep. Ron Kind (D-WI) introduced the Savings Enhancement for Education in College Act (H.R. 529), legislation that will help encourage low- and moderate-income families to take advantage of 529 plans to help save for college.

The bill includes the following provisions:

  • Reinstates the inclusion of computer technology used by the student as a qualified higher education expense.

  • Extends the current retirement saver's credit to include contributions to a 529 plan.

  • Increases the number of permitted investment changes in a 529 account within the calendar year from one to four.

  • Allows employers to make matching contributions to employee 529 accounts tax-free up to $600 per year.

The bill has been referred to the House Ways and Means Committee.

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