[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[H.R. 553 Introduced in House (IH)]

114th CONGRESS
  1st Session
                                H. R. 553

To amend the Internal Revenue Code of 1986 to encourage the use of 529 
plans and Coverdell education savings accounts, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 27, 2015

  Mr. Messer 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 encourage the use of 529 
plans and Coverdell education savings accounts, and for other purposes.

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

SECTION 1. ALLOWANCE OF HOME SCHOOL EXPENSES AS QUALIFIED EDUCATION 
              EXPENSES FOR PURPOSES OF A COVERDELL EDUCATION SAVINGS 
              ACCOUNT.

    (a) In General.--Section 530(b)(3) of the Internal Revenue Code of 
1986 is amended by adding at the end the following new subparagraph:
                    ``(C) Private school.--For purposes of this 
                section, the term `private school' includes any home 
                school that meets the requirements of State law 
                applicable to such home schools, whether or not such 
                school is deemed a private school for purposes of State 
                law.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after December 31, 2014.

SEC. 2. ELIMINATION OF COVERDELL EDUCATION SAVINGS ACCOUNT CONTRIBUTION 
              LIMITATION.

    (a) In General.--Section 530(b)(1)(A) of the Internal Revenue Code 
of 1986 is amended by inserting ``or'' at the end of clause (i), by 
striking ``or'' at the end of clause (ii) and inserting a period, and 
by striking clause (iii).
    (b) Prohibition on Excess Contributions.--Section 530(b) of such 
Code is amended by adding at the end the following new paragraph:
            ``(5) Prohibition on excess contributions.--A program shall 
        not be treated as a Coverdell education savings account unless 
        it provides adequate safeguards to prevent contributions on 
        behalf of a designated beneficiary in excess of those necessary 
        to provide for the qualified education expenses of the 
        beneficiary.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2014.

SEC. 3. 529 PROGRAMS FOR PRE-KINDERGARTEN, ELEMENTARY, AND SECONDARY 
              EDUCATION EXPENSES.

    (a) In General.--Section 529(e)(3) of the Internal Revenue Code of 
1986 is amended--
            (1) by redesignating subparagraph (B) as subparagraph (C);
            (2) by striking ``Qualified higher education expenses'' and 
        all that follows through ``The term `qualified higher education 
        expenses' means--'' and inserting the following: ``Qualified 
        education expenses.--
                    ``(A) In general.--The term `qualified education 
                expenses' means--
                            ``(i) qualified higher education expenses, 
                        and
                            ``(ii) qualified pre-kindergarten, 
                        elementary, and secondary education expenses.
                    ``(B) Qualified higher education expenses.--The 
                term `qualified higher education expenses' means''; and
            (3) by adding at the end the following new subparagraphs:
                    ``(D) Qualified pre-kindergarten, elementary, and 
                secondary education expenses.--The term `qualified pre-
                kindergarten, elementary, and secondary education 
                expenses' means--
                            ``(i) expenses for tuition, fees, academic 
                        tutoring, special needs services in the case of 
                        a special needs beneficiary, books, supplies, 
                        and other equipment which are incurred in 
                        connection with the enrollment or attendance of 
                        the designated beneficiary of the trust as a 
                        pre-kindergarten, elementary, or secondary 
                        school student at a public, private, or 
                        religious school,
                            ``(ii) expenses for room and board, 
                        uniforms, transportation, and supplementary 
                        items and services (including extended day 
                        programs) which are required or provided by a 
                        public, private, or religious school in 
                        connection with such enrollment or attendance, 
                        and
                            ``(iii) expenses for the purchase of any 
                        computer technology or equipment (as defined in 
                        section 170(e)(6)(F)(i)) or Internet access and 
                        related services, if such technology, 
                        equipment, or services are to be used by the 
                        beneficiary and the beneficiary's family during 
                        any of the years the beneficiary is in school.
                Clause (iii) shall not include expenses for computer 
                software designed for sports, games, or hobbies unless 
                the software is predominantly educational in nature.
                    ``(E) School.--The term `school' means any school 
                which provides pre-kindergarten, elementary, or 
                secondary education (pre-kindergarten through grade 
                12), as determined under State law. Such a school shall 
                be treated as an eligible educational institution for 
                purposes of subsection (b).''.
    (b) Conforming Amendments.--Section 529 of such Code is amended by 
striking ``qualified higher education'' each place it appears in 
subsections (b) and (c) and inserting ``qualified education''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2014.
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