- The Washington Times - Wednesday, January 28, 2015

The Obama administration says it still supports a plan to tax the popular “529” college savings plans but is giving up on the idea because it has become a distraction from other priorities.

White House principal deputy press secretary Eric Schultz said Wednesday it had become clear — after House Minority Leader Nancy Pelosi and other Democrats reportedly urged the president to back off the plan — that the proposal simply would get in the way of other goals.

“It was a distraction,” Mr. Schultz said. Minutes later, he was asked if the president still believes it is good policy to tax 529 plans.

“We do,” he said.

Current law allows 529 savings plans to go untaxed upon withdrawal, making them increasingly popular options for families saving for college. More than 7 million households benefit from the plans.

Republicans vehemently opposed the idea of taxing the accounts.

“I’m glad President Obama has decided to listen to the American people and withdraw his tax hike on college savings,” House Speaker John A. Boehner said Tuesday after the White House withdrew the plan.

Sign up for Daily Newsletters

Manage Newsletters

Copyright © 2020 The Washington Times, LLC. Click here for reprint permission.

Please read our comment policy before commenting.


Click to Read More and View Comments

Click to Hide