H.R.2852 - Expanded Student Saver’s Tax Credit Act (119th Congress)
Summary
H.R.2852, the "Expanded Student Saver's Tax Credit Act," aims to amend the Internal Revenue Code of 1986 to allow full-time students to be eligible for the saver's credit and saver's match. This bill modifies sections 25B(c)(2) and 6433(c)(2) of the code, removing the exclusion of full-time students. The changes would apply to contributions made after the enactment date for the saver's credit and retroactively as if included in the SECURE 2.0 Act of 2022 for the saver's match.
Expected Effects
The bill's passage would expand the eligibility for the Saver's Credit and Saver's Match to include full-time students. This would provide a financial incentive for students to save for retirement. It could also reduce the tax burden on some low-to-moderate income students.
Potential Benefits
- Encourages retirement savings among students.
- Provides a tax benefit to low-to-moderate income students.
- Simplifies the tax code by removing an exclusion.
- Could improve long-term financial security for students.
- May incentivize more students to consider long-term financial planning.
Most Benefited Areas:
Potential Disadvantages
- Potential for increased complexity in tax preparation for students and their families.
- Possible strain on government resources due to increased tax credit claims.
- May disproportionately benefit students from higher-income families who can afford to save.
- Risk of fraud or abuse in claiming the credit.
- Limited immediate impact on overall retirement savings due to students' typically low income.
Constitutional Alignment
The bill aligns with the general welfare clause of the Constitution, as it aims to promote financial security among students, potentially reducing future reliance on government assistance. Article I, Section 8 grants Congress the power to lay and collect taxes, duties, imposts, and excises, providing the constitutional basis for the Internal Revenue Code amendments proposed in the bill. The bill does not appear to infringe upon any specific constitutional rights or limitations.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).