Savings Enhancement for Education in College Act - Amends the Internal Revenue Code to: (1) allow a tax credit for contributions to qualified tuition plans; and (2) allow an exclusion, up to $600, from the gross income of an employee for employer contributions to a qualified tuition program.
[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[H.R. 529 Introduced in House (IH)]
113th CONGRESS
1st Session
H. R. 529
To amend the Internal Revenue Code of 1986 to allow certain individuals
a credit against income tax for contributions to 529 plans, and for
other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
February 6, 2013
Ms. Jenkins (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 allow certain individuals
a credit against income tax for contributions to 529 plans, 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. SHORT TITLE.
This Act may be cited as the ``Savings Enhancement for Education in
College Act''.
SEC. 2. CREDIT FOR CONTRIBUTIONS TO 529 PLANS.
(a) In General.--Subsection (d) of section 25B of the Internal
Revenue Code of 1986 (relating to elective deferrals and IRA
contributions by certain individuals) is amended by redesignating
paragraph (2) as paragraph (3) and by inserting after paragraph (1) the
following new paragraph:
``(2) Contributions to qualified tuition programs.--
``(A) In general.--The term `qualified savings
contribution' includes the amount of any purchase or
contribution described in paragraph (1)(A) of section
529(b) to a qualified tuition program (as defined in
such section) if--
``(i) the taxpayer has the power to
authorize distributions and otherwise
administer the account, and
``(ii) the designated beneficiary of such
purchase or contribution is the taxpayer, the
taxpayer's spouse, or an individual with
respect to whom the taxpayer is allowed a
deduction under section 151.
``(B) Limitation based on compensation.--The amount
treated as a qualified savings contribution by reason
of subparagraph (A) for any taxable year shall not
exceed the sum of--
``(i) the compensation (as defined in
section 219(f)(1)) includible in the taxpayer's
gross income for the taxable year, and
``(ii) the amount excluded from the
taxpayer's gross income under section 112
(relating to combat pay) for such year.
``(C) Determination of adjusted gross income.--
Solely for purposes of determining the applicable
percentage under subsection (b) which applies with
respect to the amount treated as a qualified savings
contribution by reason of subparagraph (A), adjusted
gross income (determined without regard to this
subparagraph) shall be increased by the excess (if any)
of--
``(i) the social security benefits received
during the taxable year (within the meaning of
section 86), over
``(ii) the amount included in gross income
for such year under section 86.''.
(b) Conforming Amendments.--
(1) Section 25B of such Code is amended by striking
``qualified retirement savings'' each place it appears in the
text and inserting ``qualified savings''.
(2) The subsection heading for section 25B(d) of such Code
is amended by striking ``Retirement''.
(3) Subparagraph (A) of section 25B(d)(3) of such Code, as
redesignated by subsection (a), is amended--
(A) by striking ``paragraph (1)'' the first place
it appears and inserting ``paragraph (1) or (2)'', and
(B) by striking ``paragraph (1)'' the second place
it appears and inserting ``paragraph (1), or (2), as
the case may be,''.
(4) The heading for section 25B of such Code is amended by
striking ``and ira contributions'' and inserting ``, ira
contributions, and qualified tuition program contributions''.
(5) The table of sections for subpart A of part IV of
subchapter A of chapter 1 of such Code is amended by striking
the item relating to section 25B and inserting the following
new item:
``Sec. 25B. Elective deferrals, IRA contributions, and qualified
tuition program contributions by certain
individuals.''.
(c) Effective Date.--The amendments made by this section shall
apply to contributions made after December 31, 2012, in taxable years
ending after such date.
SEC. 3. EXCLUSION FROM GROSS INCOME FOR EMPLOYER CONTRIBUTIONS TO
QUALIFIED TUITION PROGRAMS.
(a) In General.--Part III of subchapter B of chapter 1 of the
Internal Revenue Code of 1986 (relating to items specifically excluded
from gross income) is amended by inserting after section 127 the
following new section:
``SEC. 127A. EMPLOYER CONTRIBUTIONS TO QUALIFIED TUITION PROGRAMS.
``(a) In General.--Gross income of an employee does not include
amounts paid by the employer as contributions to a qualified tuition
program held by the employee or spouse of the employee if the
contributions are made pursuant to a program which is described in
subsection (b).
``(b) Maximum Exclusion.--The amount excluded from the gross income
of an employee under this section for the taxable year shall not exceed
$600.
``(c) Qualified Tuition Assistance Program.--For purposes of this
section, a qualified tuition assistance program is a separate written
plan of an employer for the benefit of such employer's employees--
``(1) under which the employer makes matching contributions
to qualified tuition programs of--
``(A) such employees,
``(B) their spouses, or
``(C) any individual with respect to whom such an
employee or spouse--
``(i) is allowed a deduction under section
151, and
``(ii) has the power to authorize
distributions and otherwise administer such
individual's account under the qualified
tuition program, and
``(2) which meets requirements similar to the requirements
of paragraphs (2), (3), (4), (5), and (6) of section 127(b).
``(d) Definitions and Special Rules.--For purposes of this
section--
``(1) Qualified tuition program.--The term `qualified
tuition program' means a qualified tuition program as defined
in section 529(b).
``(2) Employee and employer.--The terms `employee' and
`employer' shall have the meaning given such terms by
paragraphs (2) and (3), respectively, of section 127(c).
``(3) Applicable rules.--Rules similar to the rules of
paragraphs (4), (5), (6), and (7) of section 127(c) shall
apply.
``(e) Inflation Adjustment.--
``(1) In general.--In the case of any taxable year
beginning in a calendar year after 2013, the $600 amount
contained in subsection (b)(1) shall be increased by an amount
equal to--
``(A) such dollar amount, multiplied by
``(B) the cost-of-living adjustment determined
under section 1(f)(3) for the calendar year in which
the taxable year begins, determined by substituting
`calendar year 2012' for `calendar year 1992' in
subparagraph (B) thereof.
Any increase determined under the preceding sentence shall be
rounded to the nearest multiple of $50.
``(f) Cross Reference.--For reporting and recordkeeping
requirements, see section 6039D.''.
(b) Exclusion From Employment Taxes.--
(1) Sections 3121(a)(18), 3306(b)(13), and 3401(a)(18) of
such Code are each amended by inserting ``127A,'' after
``127,'' each place it appears.
(2) Section 3231(e)(6) of such Code is amended by striking
``section 127'' and inserting ``section 127 or 127A''.
(c) Reporting and Recordkeeping Requirements.--Section 6039D(d)(1)
of such Code is amended by inserting ``127A,'' after ``127,''.
(d) Other Conforming Amendments.--
(1) Sections 125(f), 414(n)(3)(C), and 414(t)(2) of such
Code are each amended by inserting ``127A,'' after ``127,''
each place it appears.
(2) Section 132(j)(8) of such Code is amended by striking
``section 127'' and inserting ``section 127 or 127A''.
(3) Section 1397(a)(2)(A) of such Code is amended by
inserting at the end the following new clause:
``(iii) Any amount paid or incurred by an
employer which is excludable from the gross
income of an employee under section 127A, but
only to the extent paid or incurred to a person
not related to the employer.''.
(4) Section 209(a)(15) of the Social Security Act (42
U.S.C. 409(a)(15)) is amended by striking ``or 129'' and
inserting ``, 127A, or 129''.
(e) Clerical Amendment.--The table of sections for part III of
subchapter B of chapter 1 of such Code is amended by inserting after
the item relating to section 127 the following new item:
``Sec. 127A. Employer contributions to qualified tuition programs.''.
(f) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after the date of the enactment of
this Act.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Ways and Means.
Llama 3.2 · runs locally in your browser
Ask anything about this bill. The AI reads the full text to answer.
Enter to send · Shift+Enter for new line