Bills › 90th General Assembly
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
Sponsored by the Senate Workforce Committee
Topics:TaxesIncome taxes
Same legislation: SF 2440
Where it is now
- Done: IntroducedFebruary 8, 2024
- Done: SubcommitteeFebruary 20, 2024
- Done: Senate committeeFebruary 8, 2024
- Done: Passes the SenateApril 19, 202432–14
- Next: House committee
- Next: Passes the House
- Next: To the Governor
- Next: Signed into law
Became SF 2440 → Its progress continues under the new number. Go to SF 2440 What’s a funnel?
What’s in it
This bill relates to the Iowa educational savings plan trust (529 plan) by expanding the definition of qualified education expenses and apprenticeship programs for purposes of withdrawals from the 529 plan qualifying for an individual income tax exclusion. The bill specifies that “qualified education expenses” include expenses paid to an institution of higher education for career-related programs that do not qualify for college credit. As a result, the expenses paid to the institution of higher education for career-related programs that do not earn college credit are excluded from the computation of net income for the individual income tax.
Read the full explanation
1. Under current law, withdrawals from a 529 plan for expenses related to an apprenticeship program registered and certified with the United States secretary of labor under the federal National Apprenticeship Act, are excluded from the computation of net income for the individual income tax. The bill expands the definition of “apprenticeship program” to include apprenticeships registered with the Iowa office of apprenticeship under Code chapter 84D, and as a result the withdrawals from a 529 plan for expenses related to an apprenticeship program registered with the Iowa office of apprenticeship are excluded from the computation of net income for the individual income tax. The federal tax treatment of the type of withdrawal described in the bill may differ from the state tax treatment under the bill. For federal tax purposes, if a withdrawal is considered a nonqualified withdrawal, the earnings portion of the nonqualified withdrawal is subject to federal taxation and a percent withdrawal penalty. The bill applies retroactively to January 1, 2024, and applies to tax years beginning on or after that date.
From the explanation printed with the bill as introduced, written by the Legislative Services Agency. Amendments adopted later aren’t reflected. Full bill text
Senate subcommittee
Named February 20, 2024. On April 2, 2024 it recommended amendment and passage. [].
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Iowa Code it changes
Read from the bill as introduced. Each links to every bill touching that chapter of the Iowa Code. How the Code works
Lobbying
2 for · 0 against · 13 undecided · Who →
Family tree
Where this legislation came from and where it went: earlier tries, the versions it moved through this Assembly, and later bills built on it.
90th General Assembly
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