A coalition of more than 650 organizations, including senior living organizations, is urging Congress to support a bipartisan bill that would expand eligible uses of college savings plans to cover workforce training, credentialing and certification costs.
Argentum, the American Health Care Association / National Center for Assisted Living, LeadingAge and several state senior living advocates joined 652 members of the Tomorrow’s Workforce Coalition in sending a letter last week urging support for S 722 / HR 1477, the Freedom to Invest in Tomorrow’s Workforce Act.
The act would permit the use of state-sponsored 529 education account funds to cover tuition, books, certification and testing costs related to workforce training programs, including certified nurse assistant programs. 529 funds are exempt from federal taxes if funds used to pay for qualified education expenses.
“The bill would shift the paradigm for 529 plans — transforming them from ‘college savings plans’ to ‘career savings plans,’ ” the letter read. “This legislation would provide flexibility for 529 beneficiaries to use their plan funds to cover whichever quality educational, training or credentialing programs that best fit their skills development, professional growth and career path — this legislation can support the entire workforce.”
The legislation, promoted by the Center for Association Leadership, would expand qualified expenses under 529 plans to include post secondary skills training and credentialing programs, including licenses and nongovernmental certifications.
The bill also would provide tax-advantaged resources for students and workers who pursue career growth, mid-career changes or career pathways that differ from a typical academic degree, according to the coalition.
Current law only permits the use of 529 accounts to pay for costs related to attending colleges, universities, vocational schools, registered apprenticeship programs, K-12 private tuition or other post-secondary institutions. Beneficiaries cannot use funds to obtain or maintain postsecondary credentials, including professional, voluntary certifications and licenses, and other training and credentials.
The proposal would cost $85 million over 10 years, according to the Joint Committee on Taxation.