Fischer Introduces the ACE Act
Press Release
U.S. Senator Deb Fischer (R-Neb.) introduced S. 243 - The Allocating for Children's Education (ACE) Act this afternoon. The ACE Act would increase the annual contribution limit for Coverdell education savings accounts from $2,000 to $5,000 per beneficiary, enabling parents to earn more money for their children's education. Fischer released the following statement regarding the legislation:
"Earning a degree is one of the most important investments our children can make for their future success. But as our economy struggles to grow, families in Nebraska and across the country find it increasingly difficult to save. That's why I have reintroduced a bill that will increase the contribution limits for Coverdell education savings accounts. Our children and grandchildren need the ability to earn a solid foundation for their future and this bill will give families greater flexibility to make this a reality."
Currently, families can set aside savings in a Coverdell account to pay for expenses like education-related technology, tuition, or tutoring. When funds are withdrawn from the Coverdell account and used for qualified educational expenses, they are entirely tax-free. As a result, families who regularly contribute to Coverdell accounts can save thousands of dollars over the long-term. Fischer's bill - The ACE Act - would increase the contribution limit for Coverdell education savings accounts from $2,000 to $5,000. Qualified elementary and secondary education expenses currently include:
Tuition, fees, academic tutoring;
Special needs services;
Books, supplies, and other equipment for students enrolled in public, private, religious school, or qualifying home school states;
Expenses for the purchase of any computer technology or equipment or Internet access and related services.
The changes to Coverdells made by this bill would apply to taxable years beginning after the date of the enactment of this act. As a result, it would enable families to earn more money while responsibly saving for their children's education
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