H.R. 3574: To amend the Internal Revenue Code of 1986 to permit qualified distributions from section 529 plans for certain transportation and parking expenses.

This bill seeks to make changes to the Internal Revenue Code regarding section 529 plans, which are tax-advantaged savings accounts primarily used for education expenses. Here’s a breakdown of the key components of the bill:

Modified Allowances for Section 529 Plans

The bill proposes several amendments to allow certain qualified distributions from section 529 plans for specific transportation and parking expenses. This means that families can withdraw money from their 529 plans not only for educational costs but also for related transportation expenses.

Transportation Expenses

Specifically, the bill includes provisions that permit the use of funds from 529 plans for “reasonable expenses for transportation (including parking)” to an eligible educational institution. This is subject to a limit that is based on the cost of attendance as defined by relevant educational guidelines.

Inclusion of Apprenticeship Programs

The bill also expands the definition of qualified expenses to include reasonable transportation and parking expenses related to participation in apprenticeship programs. This broadens the scope of what can be covered under 529 plans to include vocational and hands-on training opportunities.

Effective Date

The changes outlined in the bill would take effect for distributions made after the date the bill is enacted, meaning that families would be able to benefit from these new allowances shortly after the bill's passage.

Relevant Companies

None found.