Give Now

Lawmakers Revive College Savings Plan Expansion In Key Tax Bill

Rep. Ed DeLaney (D-Indianapolis) says the measure expanding 529 savings plans to K-12 tuition lacks transparency and should be studied further. (Lauren Chapman/IPB News)

Expanding a special college savings account is among the issues lawmakers will take up when they meet for a special session Monday, as part of a bill that would, in part, make 529 savings plans available for K-12 school tuition.

Recent changes in federal law mean states can make 529 savings accounts – used to help pay for college – available to help pay for K-12 private school tuition as well.

State lawmakers considered a bill earlier this year to make that happen, and it died, but, the provision expanding the accounts for K-12 tuition is back, as part of a major tax bill lawmakers will vote on next week.

Rep. Ed DeLaney (D-Indianapolis) says its inclusion in the bill goes against earlier talks to look further into the issue.

“The committee in the House voted to take this subject of 529 accounts and send it to a summer study committee because it was so important,” he says. “The Senate, separately, using the same bill number, took the same idea of study, made for a more elaborate study, and said ‘in the meanwhile don’t use 529 accounts for primary school and high school.'”

The 529 accounts provide tax credits to people who use them, up to $1,000 a year, and DeLaney says expanding them for K-12 could also mean a loss of more tax dollars for the state.

Another big problem DeLaney says, is the process for how the provision came back to life and will be considered in the special session.

“This should be debated and discussed. That’s why both the House and the Senate, when we were acting coherently and on a normal schedule, said ‘Hey, timeout, study this at length,’” he says.

Lawmakers won’t hear public comment or make amendments on any bills during Monday’s session.

Want to contact your legislators about an issue that matters to you? Find out how to contact your senators and member of Congress here.

What is RSS? RSS makes it possible to subscribe to a website's updates instead of visiting it by delivering new posts to your RSS reader automatically. Choose to receive some or all of the updates from Indiana Public Media News:

Support For Indiana Public Media Comes From