Iowa 2023-2024 Regular Session

Iowa Senate Bill SF2440

Introduced
4/11/24  
Engrossed
4/19/24  
Introduced
4/11/24  

Caption

A bill for an act relating to the Iowa educational savings plan trust by expanding the plan trust to include career-related programs approved by the Iowa office of apprenticeship for purposes of withdrawals qualifying for an individual income tax deduction, and including retroactive applicability provisions.(Formerly SF 2259, SSB 3128.)

Impact

The introduction of SF2440 marks a significant shift in the use of 529 plans in Iowa by broadening their applicability beyond traditional college education expenses. This change targets non-college educational pathways, including vocational and technical training, emphasizing career readiness and skills development. By enabling tax deductions for such programs, the bill aims to incentivize individuals to pursue practical training opportunities that cater to their career ambitions, potentially impacting workforce development positively in the state.

Summary

Senate File 2440 proposes an amendment to the Iowa educational savings plan trust (commonly known as a 529 plan) to include career-related programs approved by the Iowa office of apprenticeship. The bill allows for withdrawals from the 529 plan for expenses related to these career-related programs to qualify for state individual income tax deductions. Such career-related programs are defined as classes or series of classes that, while not credit-bearing, align with the beneficiaries' career aspirations and enable them to acquire skills for future employment opportunities.

Contention

Discussion surrounding SF2440 may focus on the implications of including these types of programs within the established 529 plan framework. Supporters argue that this expansion is essential for adapting Iowa's educational financial resources to contemporary labor market needs, thereby enhancing employability. However, there could be concerns regarding potential misuse of the funds or complications arising from the differentiation between career-related programs and traditional education. The bill includes retroactive applicability, effective from January 1, 2024, raising questions about its implications for individuals who have already made educational savings decisions under previous regulations.

Companion Bills

IA SSB3128

Related A bill for an act relating to the Iowa educational savings plan trust by expanding the definition of qualified educational expenses and apprenticeship programs for purposes of withdrawals qualifying for an individual income tax exclusion, and including retroactive applicability provisions.(See SF 2259, SF 2440.)

IA SF2259

Similar To A bill for an act relating to the Iowa educational savings plan trust by expanding the definition of qualified educational expenses and apprenticeship programs for purposes of withdrawals qualifying for an individual income tax exclusion, and including retroactive applicability provisions.(Formerly SSB 3128; See SF 2440.)

Previously Filed As

IA SF2259

A bill for an act relating to the Iowa educational savings plan trust by expanding the definition of qualified educational expenses and apprenticeship programs for purposes of withdrawals qualifying for an individual income tax exclusion, and including retroactive applicability provisions.(Formerly SSB 3128; See SF 2440.)

IA SSB3128

A bill for an act relating to the Iowa educational savings plan trust by expanding the definition of qualified educational expenses and apprenticeship programs for purposes of withdrawals qualifying for an individual income tax exclusion, and including retroactive applicability provisions.(See SF 2259, SF 2440.)

IA HF284

A bill for an act relating to the Iowa educational savings plan trust by excluding from the computation of net income for the individual income tax withdrawals for the payment of qualified education expenses for private instruction, and including retroactive applicability provisions.

IA HF2537

A bill for an act relating to the treasurer of state's duties, including Iowa educational savings plan trust and Iowa ABLE savings plan trust requirements and disposition of unclaimed property, and including retroactive applicability provisions.(Formerly HSB 626; See HF 2667.)

IA SF2236

A bill for an act relating to the treasurer of state's duties, including Iowa educational savings plan trust and Iowa ABLE savings plan trust requirements and disposition of unclaimed property, and including effective date and retroactive applicability provisions.(Formerly SSB 3116.)

IA HF2667

A bill for an act relating to the treasurer of state's duties, including Iowa educational savings plan trust and Iowa ABLE savings plan trust requirements and disposition of unclaimed property, and including retroactive applicability provisions. (Formerly HF 2537, HSB 626.) Effective date: 07/01/2024. Applicability date: 01/01/2024.

IA SSB3116

A bill for an act relating to the treasurer of state's duties, including Iowa educational savings plan trust and Iowa ABLE savings plan trust requirements and disposition of unclaimed property, and including effective date and retroactive applicability provisions.(See SF 2236.)

IA SF379

A bill for an act creating a deduction available against the individual income tax for educational expenses at institutions of higher education for career-related programs and apprenticeship programs, and including retroactive applicability provisions.(Formerly SSB 1119.)

IA HSB626

A bill for an act relating to the treasurer of state's duties, including Iowa educational savings plan trust and Iowa ABLE savings plan trust requirements and disposition of unclaimed property, and including effective date and retroactive applicability provisions.(See HF 2537, HF 2667.)

IA HF2160

A bill for an act excluding from the individual income tax certain direct trustee-to-trustee transfers from educational savings plan trust accounts to Roth individual retirement accounts, and including retroactive applicability provisions.

Similar Bills

No similar bills found.