Poliquin bill would provide more flexibility, options for saving for college

U.S. Rep. Bruce Poliquin (R-ME) introduced legislation on Monday that would provide additional options to parents and students who are saving for college by making 529 college savings accounts more flexible.

The Help All Americans Save for College Act would modify 529 college savings accounts to enable employees to deduct up to $5,000 per dependent on federal taxes for college savings, allow employers to match contributions tax-free, and change 529 accounts into tax benefits to compel businesses to provide more resources on them.

“College tuition costs are higher now than ever,” Poliquin said during a press conference at the University of Maine, in Orono. “When I was entering college, students were able to work a job during the summer and take on only a modest amount of debt, if any, to finance their education. Today, students are incurring insurmountable debt and, as a result, are often discouraged from pursuing the schools and careers of their choice.”

Currently, less than three percent of families in the United States use 529 accounts to save for college because of their complexity and lack of fundamental features, according to the Government Accountability Office.

“This bill will change traditional college savings accounts, 529s, to operate similarly to 401(k) retirement savings accounts, providing more options for our kids and anyone seeking higher education,” Poliquin said. “It will give families better federal tax deductions out of their 529 deposits, allow employers to match deposits without being taxed — incentivizing them to provide greater contributions — and give the average employee the instruction he or she might need to understand and properly take advantage of these oftentimes complex tax benefits. This new legislation will provide critically needed and essential resources for parents and students to plan ahead.”

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