The House Ways and Means Committee released an amended version of H.R. 88, the “Retirement, Savings, and Other Tax Relief Act of 2018,” on December 10. It contains a few notable changes from the bill’s first release late in November.
Generally, the retirement-related provisions in the amended bill are the same as the previous iteration. The majority of the new tax-deferred savings arrangement-related provisions are for Qualified Tuition Programs (commonly referred to as “529 plans”). Following are some of the changes to the amended bill in comparison to the late November release.
- Disaster relief is amended to now include relief for victims of severe storms and flooding in Wisconsin, Texas, North Carolina, Indiana, and Alabama, and also for victims of Tropical Storm Gita in American Samoa.
- An automatic 60-day extension would be granted for any tax filing for taxpayers with a principal abode or place of business located in a disaster area (effective for disasters declared after December 31, 2017).
- Qualified higher education expenses in 529 plans now would include expenses for fees, books, etc. of a designated beneficiary in an apprenticeship program registered and certified by the Secretary of Labor (effective for distributions taken after December 31, 2018).
- Qualified higher education expenses in 529 plans would now include expenses for materials, books, etc. of a designated beneficiary for homeschooling (effective for distributions taken after December 31, 2018).
- Qualified higher education expenses in 529 plans would now include reference to amounts paid as principal or interest on any “qualified education loan” (i.e., indebtedness incurred by a taxpayer to pay qualified higher education expenses), capped at $10,000 over an individual’s lifetime (effective for distributions taken after December 31, 2018).
- Unborn children (i.e., children in utero) would now be allowed to be named as 529 plan account beneficiaries (effective for contributions made after December 31, 2018).
- Several provisions were added in an attempt to restructure and modernize the IRS, including provisions related to online filings.
- Several provisions were added that relate to health and medical excise taxes.
The updated version of the bill is seen by many as having a reasonable chance of passing, although there is certainly opposition in both houses of Congress to the bill in its current form. Watch this ascensus.com news for further developments.