December 8, 2017

Expanded 529 Plan Would Have Provided Families an Additional Financial Tool

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William Estrada, Esq. by WILLIAM ESTRADA Director of Federal Relations

Home School Legal Defense Association applauds U.S. Senator Ted Cruz (TX) for introducing an amendment which contained HSLDA’s language ensuring that homeschoolers are able to use their own 529 plans for homeschool expenses in kindergarten through 12th grade. Unfortunately, the language was removed in the final version of the bill.

Cruz was joined by Senators Tom Cotton (AR), Mike Lee (UT), and Ben Sasse (NE) when he introduced his amendment on the floor of the Senate, and every single Republican senator except for Senators Lisa Murkowski (AK) and Susan Collins (ME) voted in favor of the amendment on the Senate floor. Vice President Mike Pence cast the tie-breaking vote.

HSLDA thanks Senators Cruz, Cotton, Lee, and Sasse for their support for homeschoolers, to the other 46 members of the U.S. Senate who voted in favor of this amendment, and to Vice President Mike Pence for casting his tie-breaking vote.

HSLDA strongly opposes any federal funds for homeschoolers. We have vigorously opposed past attempts to give federal money to homeschool families, and will continue to do so.

HSLDA supports efforts to treat homeschoolers fairly. Many families use and love their 529 plans, which allow them to save their own money for use in higher education. Congress is expanding 529 plans to include K-12 public and private school expenses, and we had hoped homeschool families would have been permitted also to use their 529 plans in this way, if they wished. This is what Senator Cruz’s amendment would have done, and why HSLDA supported it.

In the past, homeschool families in the small number of states that define homeschool programs as a type of private school were able to use Coverdell plans for K-12 homeschool expenses. This was limited, as most states have a homeschool statute, and families in these states were not able to use Coverdells. The expansion proposed in Congress would have allowed all families to use 529 plans for K-12 expenses, if they wished, just like the small number of families who used to be able to use Coverdell plans for K-12 homeschool expenses.

The bottom line is that a 529 plan is your own money, not government money. You put it into your own account after taxes. You decide whether and how to use it, or even whether to create a 529 plan for your children. HSLDA was hopeful Congress would ensure that homeschoolers had another tool in their financial toolbox as they educated their children at home.