U.S. Rep. Lynn Jenkins, alongside fellow House of Representatives member Ron Kind (D-WI), introduced new legislation on Monday that will strengthen and increase the effectiveness of 529 college savings plans.
If passed, the law would make three significant improvements to the 529 savings program. First, it would remove the gray areas surrounding the eligibility of computer expenses, permanently clarifying that computers are a necessary item for students and that they are indeed qualified expenses.
“Saving for our children’s education is one of the most important, and at times, most difficult aspects of being a parent,” Jenkins said.“ This bill would expand 529 plans to further promote college access and eliminate barriers for middle class families to save and plan ahead. It would also modernize the program by allowing students to purchase a computer using their 529 funds. These are particularly important goals as college costs continue to rise and students are struggling with extreme amounts of student loan debt.”
The bill would also remove distribution aggregation requirements, eliminating unnecessary paperwork, and permit the redeposit of refunds from colleges without the burden of taxes or penalties.
“As the representative of 14 colleges and universities across western and central Wisconsin, one of my top priorities is working to keep college affordable,” Kind added. “Helping students attend college ultimately makes America more competitive in the global marketplace; but with rising tuition costs and the growing crisis of student loan debt, we need to use every tool we can to help families afford higher education.”
The significance and use of 529 college savings plans has steadily increased over the years, as more middle-class families have tapped into the program. Since the creation of 520 plans nearly 20 years ago, they have gone from zero to almost 12 million accounts and resulted in education savings of more than $225 billion.
“This bipartisan, sensible legislation strengthens an extremely popular savings plan for middle-class families so that all American’s have the opportunity to send their children to the college institution of their choice,” Jenkins concluded.