Did you know that there was a last-minute change to the Senate tax bill?
And get this: It could be a great benefit to Catholic families.
Sen. Ted Cruz, R-TX, came forward with a proposal to allow 529 savings accounts to be spent on private, religious, and homeschool tuition and expenses. Currently, such 529 accounts can only be spent on tuition and expenses for college.
Columnist Ryan Ellis spells it out over at Forbes:
“529 plans can be thought of as the rough equivalent of Roth IRAs for education–money goes in after tax, but then grows tax free. Distributions are tax exempt if used for qualified education expenses. If you participate in your home state’s 529 plan (these accounts are mostly run by state agencies), you may be eligible for a state tax deduction.
“If the Cruz amendment makes its way into the final bill (and there is nearly identical language in the House version, so there is a good shot of this), the game will have changed on school choice. Parents can start saving right away for private or parochial school, or for homeschooling expenses, in a 529 plan when a child is born. That money can grow tax-free for years to pay for things like Montessori school, Catholic high school, or home schooling networks. With a tax deductible component in most states, parents will get an immediate tax benefit, and then further tax relief in the form of tax-free growth.”
The Senate bill already lowered the tax rates in many brackets and doubled the Child Tax Credit to $2,000. Senator Cruz’s expansion of 529 accounts for K-12 private, religious, and homeschooling is another great feature of the bill.
This is a great first step in helping parents who already pay for education twice: Once in property taxes for their local public schools and a second time for their Catholic school or homeschool.
Another reason CV is urging passage of this tax reform bill.