Section 1 Short title
This Act may be cited as the “Helping Families Save for Education Act”.
Helping Families Save for Education Act
A BILL
To amend the Internal Revenue Code of 1986 to expand access to Coverdell education savings accounts.
Sec. 2 Findings
The Congress finds the following:
College costs have increased tremendously over the past decade. Between academic year 2002–2003 and academic year 2012–2013—
published tuition and fees for students at public 4-year institutions of higher education increased from $5,213 to $8,655 or by 66 percent beyond the rate of inflation,
published tuition and fees for students at public 2-year institutions of higher education increased from $2,129 to $3,131 or by 47 percent beyond the rate of inflation, and
published tuition and fees for students at private 4-year institutions of higher education increased from $22,974 to $29,056 or by 26 percent beyond the rate of inflation.
Federal financial aid for students has also increased rapidly but failed to mitigate the issues of rising college costs. Between academic year 2001–2002 and academic year 2011–2012—
the amount of Federal financial aid in the form of Federal Pell Grants, Federal student loans, campus-based aid, veterans educational benefits, and tax credits increased from $72.3 billion to $173.8 billion or by 140 percent beyond the rate of inflation, and
the Federal Government’s share of total student aid administered increased from 67 percent to 73 percent.
Sec. 3 Expansion of Coverdell education savings accounts
Increase in age limitation of beneficiary after which contributions to account cannot be made— Clause (ii) of section 530(b)(1)(A) of the Internal Revenue Code of 1986 is amended by striking “age 18” and inserting “age 22”.
Increase in annual dollar limitation on contributions to account— Clause (iii) of section 530(b)(1)(A) of such Code is amended by striking “$2,000” and inserting “$10,000”.
Effective dates—
Increase in age limitation— The amendment made by subsection (a) shall apply to contributions made after the date of the enactment of this Act.
Increase in annual dollar limitation on contributions— The amendments made by subsection (b) shall apply to contributions made in taxable years ending after the date of the enactment of this Act.