No CRS summary available for this bill.
This section establishes a special rule under IRC §529(c)(3)(F) excluding from gross income (and the 10% additional tax on nonqualified distributions) specified amounts distributed from qualified tuition programs (i.e., 529 plans, tax-advantaged savings plans for qualified higher education expenses) maintained for at least 15 years, if used within 60 days by a first-time homebuyer designated beneficiary to purchase a principal residence and not exceeding contributions to the account (plus attributable earnings) made in the preceding 5 years. The rule applies up to an aggregate $35,000 lifetime limit per beneficiary, shared with rollovers to Roth IRAs under §529(c)(3)(E) (thus coordinating the two provisions by amending §529(c)(3)(E)(ii)(II)). It further allows rollover of unused amounts into another 529 plan or ABLE account within 120 days if the home purchase is delayed or canceled; imposes recapture of deferred tax plus interest (phased down 20% per full year held) if the residence is sold or ceases to be principal within 5 years; and applies to distributions in taxable years beginning after enactment.