Currently, only colleges, universities, vocational schools or other post-secondary educational institutions are considered an eligible ‘529’ education savings account expense
New legislation would allow workers to use ‘529’ education savings accounts for training and credential programs to develop the skills needed for 21st century jobs
WASHINGTON, DC – U.S. Senator Amy Klobuchar introduced legislation to expand the eligible uses of the ‘529’ tax advantaged education savings program to include training and credential programs that help workers develop the skills needed for 21st century jobs. The bill, S. 1822, would amend current law to allow workers to use ‘529’ education savings accounts to pay for training or credentialing programs recognized by a state, the federal government, or industry, in addition to currently allowable uses for colleges, universities, vocational schools or other post-secondary educational institutions. Senators Dianne Feinstein (D-CA), Tammy Baldwin (D-WI), Tammy Duckworth (D-IL), Joe Manchin (D-WV), and Heidi Heitkamp (D-ND) have cosponsored the legislation.
“The American workforce is changing and the skills needed for the jobs available are changing too,” Senator Klobuchar said. “People need the ability to save to get the education and training they need for 21st century jobs, whether they’re enrolling in college, attending a short-term training program, or getting a license or credential for a specific trade or industry.”
Klobuchar has long supported efforts to help workers succeed in an increasingly specialized workforce while making the country’s economy more competitive. In April, she and Senator Susan Collins (R-ME) introduced the bipartisan American Apprenticeship Act, which would provide funding to states for the creation or expansion of tuition assistance programs that benefit participants in pre-apprenticeship and Registered Apprenticeship programs. She is also a cosponsor of the bipartisan Apprenticeships and Jobs Training Act of 2017 and the Leveraging and Energizing America’s Apprenticeship Programs (LEAP) Act, which would provide a tax credit to employers to hire registered apprentices and help increase the number of registered apprenticeships in the U.S. respectively.
Last year, Klobuchar successfully pushed for a $5 million grant from the Department of Labor to strengthen partnerships between community colleges and local businesses and expand apprenticeship programs. Klobuchar also helped pass the Workforce Innovation and Opportunity Act in June 2014, which included her bipartisan provision to help match the skills of workers with the needs of local employers. The provision established competitive grants for partnerships that help provide workers with the skills needed to fill vacancies in up-and-coming industries. In 2015, she led bipartisan legislation with Senator John Hoeven (R-ND), the Innovate America Act, which would fund 100 new Science, Technology, Engineering, and Mathematics (STEM)-focused high schools and help ensure workers have the skills they need for today’s competitive global economy.