The House of Representatives has overwhelmingly approved legislation to expand the tax benefits of 529 college-savings accounts, less than a month after the Obama administration's failed bid to raise taxes on such accounts.
By a 401 to 20 vote, House lawmakers approved a measure that would include computers and software as qualifying educational expenses on which families can spend 529 account savings. It would also simplify how taxpayers calculate their benefits associated with the plan and would allow families to redeposit tuition refunds back into a 529 account without penalty.
The bill would cost $51 million over 10 years, according to a Congressional Budget Office estimate.
Several Democrats had sought to offset that cost by eliminating 529 plans for families with adjusted gross incomes above $3 million. But that amendment was rejected by the Republican-controlled House Rules committee earlier this week.
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