What's happening
This bill exempts funds in qualified 529 tuition programs from being counted when calculating eligibility for public assistance benefits.
Why it matters
Encourages saving for education. By allowing 529 college savings accounts to be exempt from public assistance eligibility calculations, the bill eliminates a penalty for low-income families who try to save for their children's education, promoting long-term financial planning and upward mobility.
Reduces disincentives for asset building. Current rules may force families to spend down or avoid saving in 529 plans to remain eligible for assistance, trapping them in a cycle of poverty. This change lets families build educational assets without risking critical benefits.
Aligns state policy with federal intent. The federal government already provides tax advantages for 529 plans to encourage education savings. This amendment brings state public assistance policy in line with those federal goals, ensuring families don’t face conflicting incentives.
Potential for broader impact on intergenerational poverty. By making it easier for public assistance recipients to save for higher education, the bill could help break cycles of poverty, as higher education is strongly linked to increased future earnings and social mobility.
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Who cares
Headline styles
Protect College Savings Accounts
Plain English, a few words. Used as the page title.
Sponsors
No co-sponsors yet.
History
- Referred to rules
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Protect College Savings for Aid
Assembly Floor Calendar · Sponsor Michele Titus
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
9035
IN SENATE
June 14, 2018
Introduced by Sen. PERSAUD -- read twice and ordered printed, and when printed to be committed to the Committee on Rules
AN ACT to amend the social services law, in relation to exempting certain funds in a qualified tuition program in the calculation of household benefits under public assistance programs
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Subdivision 1 of section 131-n of the social services law, as amended by section 1 of part X of chapter 54 of the laws of 2016, is amended to read as follows:
1. The following resources shall be exempt and disregarded in calculating the amount of benefits of any household under any public assistance program: (a) cash and liquid or nonliquid resources up to two thousand dollars, or three thousand dollars in the case of households in which any member is sixty years of age or older, (b) an amount up to four thousand six hundred fifty dollars in a separate bank account established by an individual while currently in receipt of assistance for the sole purpose of enabling the individual to purchase a first or replacement vehicle for the recipient to seek, obtain or maintain employment, so long as the funds are not used for any other purpose, (c) an amount up to one thousand four hundred dollars in a separate bank account established by an individual while currently in receipt of assistance for the purpose of paying tuition at a two-year or four-year accredited post-secondary educational institution, so long as the funds are not used for any other purpose, (d) the home which is the usual residence of the household, (e) one automobile, up to ten thousand dollars fair market value, through March thirty-first, two thousand seventeen; one automobile, up to eleven thousand dollars fair market value, from April first, two thousand seventeen through March thirtyfirst, two thousand eighteen; and one automobile, up to twelve thousand dollars fair market value, beginning April first, two thousand eighteen and thereafter, or such other higher dollar value as the local social services district may elect to adopt, (f) one burial plot per household member as defined in department regulations, (g) bona fide funeral
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD01980-01-7
S. 9035 2
agreements up to a total of one thousand five hundred dollars in equity value per household member, (h) funds in an individual development account established in accordance with subdivision five of section three hundred fifty-eight of this chapter and section four hundred three of the social security act [and], (i) for a period of six months, real property which the household is making a good faith effort to sell, in accordance with department regulations and tangible personal property necessary for business or for employment purposes in accordance with department regulations, and (j) funds in a qualified tuition program that satisfies the requirement of section 529 of the Internal Revenue Code of 1986, as amended. If federal law or regulations require the exemption or disregard of additional income and resources in determining need for family assistance, or medical assistance not exempted or disregarded pursuant to any other provision of this chapter, the department may, by regulations subject to the approval of the director of the budget, require social services officials to exempt or disregard such income and resources. Refunds resulting from earned income tax credits shall be disregarded in public assistance programs.
§ 2. This act shall take effect immediately; provided, however, that the amendments to section 131-n of the social services law made by section one of this act shall not affect the expiration of such section and shall be deemed to expire therewith.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the social services law, in relation to exempting certain funds in a qualified tuition program in the calcu- lation of household benefits under public assistance programs
Purpose of bill
This legislation will exempt or disregard funds in a qualified tuition program that satisfies the requirement of section 529 of the Internal Revenue Code of 1986, as amended, from assets limit tests to qualify for public assistance.
Summary of specific provisions
Section 1. Subdivision 1 of section 131-n of the social services law, as amended by chapter 373 of the laws of 2003, paragraph (c) as amended by section 5 of part J of chapter 58 of the laws of 2014, is amended to include the exemption of funds in qualified tuition programs.
Justification
Currently New Yorkers who have more than $2,000 in assets are not eligi- ble to receive public assistance. A few of these assets as listed in New York Social services Law 131-n are excluded; such as refunds from the Earned Income tax credit and individual Development Accounts which aid families in saving money allowing them to work towards greater self-suf- ficiency. Currently 529 accounts which permit families to put aside money and invest in their children's future college educations are not included in these exemptions. Meaning if a family is able to put aside $2,000 to help send their children to college they can no longer receive public assistance, this puts these families at a grave disadvantage. A recent study showed that a mere 9% of students from low-income families obtain a bachelor's degree compared with 54% of students from wealthier families. New York's low-income families need support and assistance so that they may develop college savings for their children. In order to help these families obtain The American dream and aid their children in attending college Social Services Law 131-n desperately needs to be amended to exempt 529 accounts to help these New York families.
Fiscal implications
To be determined.
Legislative history
A3156 (2015-2016) referred to social services
Effective date
This act shall take effect immediately; provided, however, that the amendments to section 131-n of the social services law made by section one of this act shall not affect the expiration of such section and shall be deemed to expire therewith.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.