This week, the Senate began consideration of a bill (S. 1134) that would expand education savings accounts that were established by Congress as part of the 1997 Balanced Budget Act (P.L. 105-34). The measure would expand the accounts from the current $500 maximum to $2,000. In addition to higher education costs, the measure would allow withdrawals to help pay for elementary and secondary education. Earnings on the accounts would remain tax-free, as would withdrawals used to help pay costs associated with education. Similar proposals have been vetoed twice by the President, once as a stand-alone bill (H.R. 2646) in 1998 and again as part of last year’s tax package (H.R. 2488).
On February 24, Senate Majority Leader Trent Lott (R-MS) filed a cloture motion to limit debate on the bill. The Senate will vote on that motion on February 29. Democrats opposed to the measure have threatened to offer a number of amendments that would highlight their education priorities, including special education, teacher training, and teacher certification.
