Students and families may get more help to defray the costs of education. Senator Ted Cruz (R-TX) introduced the Student Empowerment Act, which expands 529 College Savings Plans to include K-12 elementary and secondary school expenses for public, private, and religious schools, including homeschooling.
This measure builds on Senator Cruz’s Student Opportunity Amendment which was passed as part of the Tax Cuts and Jobs Act by Republicans last December. The amendment allows all students – including public, private, and religious students – to use 529 savings accounts to cover eligible educational expenses, such as tutoring, standardized testing fees, and educational therapies for students with disabilities.
The Student Empowerment Act expands the definition of “qualified higher education expense” to include the following elementary, secondary and homeschool expenses:
Curriculum and curriculum materials
Books and other instructional materials
Online education materials
Tuition for tutoring or educational classes outside of the home when the teacher is licensed, has taught at an eligible institution or is a subject matter expert in the topic
Fees for standardized tests (SAT and ACT), AP exams, or any exams related to college or university admission
Fees for dual enrollment
Costs of educational therapy (occupational, behavioral, physical, and speech-language) for students living with disabilities
The act will also be inclusive of homeschoolers who were excluded from the expansion of 529s last year. Senator Cruz explains:
“Homeschool families were cynically excluded by Senate Democrats from the Student Opportunity Amendment, leaving homeschoolers ineligible to utilize the expanded usage of 529 savings accounts.This bill rights that wrong, by re-including homeschool families as equally eligible to use a 529 savings account for educational expenses, to ensure that all families are able to use these tax-advantaged accounts to pay for their child’s elementary and secondary education.”
Middle-class families are by and large the groups that use 529 plans to help defray the costs and college. Thanks to Congress, they can now also use those savings for K-12 expenses.
Hopefully, Congress will pass this measure to expand a great tool for families of all kinds to save for the educational needs of their kids at all stages of their educations.