Houghton bill would eliminate certain non-degree expenses from 529

House Ways and Means Committee member Amo Houghton (R-NY) on April 2 introduced HR 4136, the Education Tax Credit Simplification Act of 2004. The bill would eliminate from section 529 qualified expenses any expense associated with instruction involving sports, games, or hobbies, unless the course is part of the beneficiary's degree program. Of more importance to many families, the bill would combine the Hope and Lifetime Learning credits into one credit worth as much as $3,000 annually. The definition of qualifying expenses would be made uniform under several of the education provisions, including the education credit, section 529, the deduction for interest on student loans, the tuition deduction, and the exclusion of interest on the redemption of certain U.S. savings bonds.
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