HR 37
112th CONGRESS
1st Session
H. R. 37
To amend the Internal Revenue Code of 1986 to improve and expand
education savings accounts.
IN THE HOUSE OF REPRESENTATIVES
January 5, 2011
Mrs. BIGGERT 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 improve and expand
education savings accounts.
Be it enacted by the Senate and House of Representatives of the United
States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the `401Kids Family Savings Act of 2011'.
SEC. 2. EXTENSION OF DATE FOR SUNSET OF CERTAIN EDUCATION SAVINGS INCENTIVES.
In the case of the provisions of, and amendments made by, section 401 of the
Economic Growth and Tax Relief Reconciliation Act of 2001 (relating to modifications
to education individual retirement accounts), section 901 of such Act (relating
to sunset of provisions of Act) shall be applied by substituting `December
31, 2015' for `December 31, 2012' in subsection (a)(1) thereof.
SEC. 3. DISTRIBUTIONS FROM EDUCATION SAVINGS ACCOUNTS FOR FIRST HOME PURCHASES
TREATED AS QUALIFIED DISTRIBUTIONS.
(a) In General- Subsections (b)(1), (d)(2)(A), (d)(2)(B), (d)(2)(C)(ii)(II),
and (d)(2)(D) of section 530 of the Internal Revenue Code of 1986 are each
amended by striking `qualified education expenses' and inserting `qualified
expenses'.
(b) Qualified Expenses- Subsection (b) of section 530 of such Code is amended--
(1) by redesignating paragraphs (2) through (4) as paragraphs (3) through
(5), respectively, and by inserting after paragraph (1) the following new
paragraph:
`(2) QUALIFIED EXPENSES- The term `qualified expenses' means--
`(A) qualified education expenses (as defined in paragraph (3)), and
`(B) qualified first-time homebuyer expenses (as defined in paragraph
(4)).', and
(2) by redesignating paragraphs (4) and (5) (as redesignated by paragraph
(1)) as paragraphs (5) and (6), respectively, and by inserting after paragraph
(3) the following new paragraph:
`(4) QUALIFIED FIRST-TIME HOMEBUYER EXPENSES- The term `qualified first-time
homebuyer expenses' means, in the case of a designated beneficiary who is
a first-time homebuyer, the qualified acquisition costs with respect to
a principal residence of such beneficiary. Terms used in this paragraph
shall have the same meaning as when used in section 72(t)(8).'.
(c) Conforming Amendment- The heading for paragraph (2) of section 530(d)
of such Code is amended by striking `QUALIFIED EDUCATION EXPENSES' and inserting
`QUALIFIED EXPENSES'.
(d) Effective Date- The amendments made by this section shall apply to taxable
years beginning after the date of the enactment of this Act.
SEC. 4. ROLLOVERS FROM EDUCATION SAVINGS ACCOUNTS TO ROTH IRAS.
(a) In General- Paragraph (5) of section 530(d) of the Internal Revenue Code
of 1986, as amended by section 5, is amended by inserting `or a Roth IRA'
after `another 401Kids savings account'.
(b) Conforming Amendment- Subsection (e) of section 408A of such Code is amended
by inserting the following after the second sentence: `Such term includes
a rollover contribution to a Roth IRA from a 401Kids savings account described
in section 530(d)(5).'.
(c) Effective Date- The amendments made by this section shall apply to taxable
years beginning after the date of the enactment of this Act.
SEC. 5. RENAMING COVERDELL EDUCATION SAVINGS ACCOUNTS AS 401KIDS SAVINGS
ACCOUNTS.
(a) In General- Section 530 of the Internal Revenue Code of 1986 is amended
by striking `Coverdell education savings account' each place it appears and
inserting `401Kids savings account'.
(b) Conforming Amendments-
(1) The following provisions of the Internal Revenue Code of 1986 are amended
by striking `Coverdell education savings' each place it appears and inserting
`401Kids savings':
(C) Section 135(c)(2)(C).
(F) Subsections (a) and (e) of section 4973(a).
(G) Subsections (c) and (e) of section 4975.
(H) Section 6693(a)(2)(E).
(2) The headings for the following provisions of such Code are amended by
striking `coverdell education savings' and inserting `401kids savings':
(B) Section 135(c)(2)(C).
(C) Section 529(c)(3)(B)(vi).
(3) The heading for section 4973(e) of such Code is amended by striking
`Coverdell Education Savings' and inserting `401Kids Savings'.
(4) The heading for section 530 of such Code is amended to read as follows:
`SEC. 530. 401KIDS SAVINGS ACCOUNTS.'.
(5) The item in the table of contents for part VII of subchapter F of chapter
1 of such Code relating to section 530 is amended to read as follows:
`Sec. 530. 401Kids savings accounts.'.
(c) Effective Date- The amendments made by this section shall apply to taxable
years beginning after the date of the enactment of this Act.
END
