We have major news to share: HR 1477, the House version of the Freedom to Invest in Tomorrow’s Workforce Act, gained its first Democratic cosponsor on the Ways & Means Committee! Congressman John Larson (D-CT-1) joined yesterday.
This is a big deal. The legislation now has bipartisan support on the committees of jurisdiction in both the House and Senate – a major milestone, indeed.
Congressman Larson’s support bumps the cosponsor total for HR 1477 to 144 and the legislation will surpass 150 cosponsors in short order.
The Tomorrow’s Workforce Coalition includes IHMM and more than 800 organizations that operate in more than 50 industries and advocate for beneficial workforce development policies that would strengthen the economy now and into the future. The Coalition supports the bipartisan, bicameral Freedom to Invest in Tomorrow’s Workforce Act (S. 722 / H.R. 1477), expanding qualified expenses under 529 savings plans to include postsecondary training and credentialing, such as licenses and professional certifications. The bill would provide valuable tax-advantaged resources for families, students, and workers—with or without a college degree—who pursue career growth, mid-career changes or pathways that diverge from a typical academic route. According to the Joint Committee on Taxation, the bill will cost $85 million over 10 years.
S. 722 / H.R. 1477 would empower Americans of any educational background, skill level, or age, and would benefit all industries and professions that rely on employees with specialized training or credentials. The bill would encourage more workers and families to save funds on a tax-preferred basis for career options that best suit the plan beneficiary. It would transform 529s from college savings plans to career savings plans.
What are 529 Savings Plans? A 529 plan is a state-sponsored education savings vehicle that is exempt from federal taxes if funds are used to pay for qualified education expenses. These include college, graduate or professional degrees; programs from Title IV-accredited institutions; registered apprenticeships; up to $10,000/year in K-12 tuition; and certain student loan repayments.
What’s the Issue? Training & Credentials are Ineligible for 529s America’s workforce is comprised mostly of middle-skill jobs that require more than a high school education but not a bachelor’s degree, according to the National Skills Coalition. A differentiator amid the 21st-century workforce is postsecondary credentialing—for workers with or without a two- or four-year degree.
The Freedom to Invest in Tomorrow’s Workforce Act Would Provide Economic Flexibility and Opportunity Workers and families could use 529 plans to help cover: • Credential program tuition, including prep courses; • Testing fees, including practice exams; • Required books and equipment; • Continuing education and credential renewal; and • Other charges required to obtain and maintain a postsecondary credential.
