Hensarling Votes to Expand 529 College Savings Program
WASHINGTON – Congressman Jeb Hensarling (R-TX), Chairman of the House Financial Services Committee, issued the following statement today in support of House-passed legislation to improve 529 college savings plans (H.R. 529).
“Hard-working American families are struggling to cope with the ever-rising cost of college. 529 savings plans have been a valuable tool to help these families save for college. Similar to a ROTH IRA retirement account, 529 plans use the power of compound interest to allow contributions to grow tax free for the purpose of qualified higher education expenses. In Texas alone, the nearly 140,000 529 accounts have helped families save more than $2 billion for college.
“While this popular program has allowed millions of low and middle income families to save for future education expenses, it has not escaped the crosshairs of President Obama and his insatiable appetite for higher taxes. In fact, President Obama’s budget would have placed an even greater burden on American families who are struggling to save for higher education by proposing an ill-fated de facto repeal of 529 accounts by taxing the earnings.
“In contrast to President Obama’s original plan that would virtually destroy 529 accounts, the legislation passed by the House today will expand educational opportunities for millions of Americans by making it easier for parents and children to save for college by expanding the program to treat computer equipment and other technology as a qualified expense while making improvements to the contribution and distribution process.
“As a father of two school-aged children, I understand how daunting a task saving for college can be. Instead of burdening millions of American families by taxing these programs as the President has proposed, I and my fellow House Republicans remain committed to strengthening and expanding these successful and popular savings vehicles.”