Rep. Poliquin Introduces Bill to Help Parents and Students Save for College
ORONO, Maine – Today, Maine’s 2nd District Congressman, Bruce Poliquin, announced his new bill that will provide parents and students additional options to save for college by improving 529 college savings plans.
The Help All Americans Save for College Act of 2016 will revise 529’s to operate more similarly to the 401(k) retirement savings accounts so many people use. It will make these significant changes: 1) allow employees to deduct up to $5,000 per dependent from their federal taxes for money deposited into a 529 account, 2) allow employers to match contributions tax-free while giving them the flexibility to choose their contributions of up to $5,000 per employee dependent, and 3) change 529’s into tax benefits, incentivizing businesses to provide workers access to human resource services that can help explain any complexities.
In essence, among other changes, Congressman Poliquin’s bill will help make college tuition for kids another employee benefit that job creators can use to attract and retain employees, by matching their contributions toward their kid’s education.
Congressman Poliquin released the following statement:
“College tuition costs are higher now than ever,” said Congressman Poliquin. “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.
Congressman Poliquin announces his new bill, the Help All Americans Save for College Act, that will give parents and students more options to plan ahead.
“It is critical that families have the options they need to more easily save for higher education. That is why I am proud to introduce the Help All Americans Save for College Act. This bill will change traditional college savings accounts, 529’s, to operate similarly to 401(k) retirement savings accounts, providing more options for our kids and anyone seeking higher education. 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.”
529 plans are designed to aid our families and working students in growing the savings they need for tuition payments by providing tax benefits on the money they put aside. However, these programs are simply not doing enough to help parents and students. 529’s are complicated and lack fundamental features that would make it easier for families to use them and save for college. According to a Government Accountability Office (GAO) study, less than 3% of families in the U.S. saved in a 529 plan. Even among those who identified saving for education as a priority, less than 1 in 10 families used a 529 plan. Plans are too complicated and need to be explained. This new bill will simplify the process and provide more options for our children and those seeking higher education.
Click HERE to see the full text of the Help All Americans Save for College Act of 2016.