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To amend the Internal Revenue Code of 1986 to permit qualified distributions from section 529 plans for certain transportation and parking expenses.
To amend the Internal Revenue Code of 1986 to permit qualified distributions from section 529 plans for certain transportation and parking expenses.
Summary
This bill amends the Internal Revenue Code to expand the types of expenses that can be paid with tax-free distributions from section 529 education savings plans. The bill permits qualified distributions to be used for reasonable transportation expenses, including parking, to attend an eligible educational institution, up to the allowance for transportation included in the institution's cost of attendance. The bill also extends this provision to transportation expenses related to participating in apprenticeship programs. The changes apply to distributions made after the bill's enactment.
AI-generated plain-language summary of the bill text — neutral, and may be imperfect. See the full text below for the exact wording.
Sponsor (1)
1 cosponsor
Actions (2)
- May 23, 2025 Referred to the House Committee on Ways and Means. · house
- May 23, 2025 Introduced in House
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Text versions (1)
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Full text
IN THE HOUSE OF REPRESENTATIVES
May 23, 2025
Ms. McClellan (for herself and Ms. Sanchez) 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 permit qualified distributions from section 529 plans for certain transportation and parking expenses.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. QUALIFIED DISTRIBUTIONS FROM SECTION 529 PLANS FOR CERTAIN TRANSPORTATION AND PARKING EXPENSES.
(a) In General.—Section 529(e)(3)(A) of the Internal Revenue Code of 1986 is amended by striking “and” at the end of clause (ii), by striking the period at the end of clause (iii) and inserting “, and”, and by inserting after clause (iii) the following new clause:
“(iv) reasonable expenses for transportation (including parking) to such eligible educational institution, not in excess of the allowance (applicable to the student) for transportation included in the cost of attendance (as defined in section 472 of the Higher Education Act of 1965 (20 U.S.C. 1087ll), as in effect on the date of the enactment of this clause) as determined by such eligible educational institution.”.
(b) Apprenticeship Programs.—Section 529(c)(8) of such Code is amended by inserting “and to reasonable expenses for transportation (including parking) in connection with such participation” before the period at the end.
(c) Effective Date.—The amendments made by this section shall apply to distributions made after the date of the enactment of this Act. <all>
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