Republican Senators propose tax code reform to promote school choice   

U.S. Senator Mike Lee, R-Utah, has introduced a bill to advance education freedom by reforming the federal tax code.  

The Achieving Choice in Education (ACE) Act, introduced Wednesday, is cosponsored by Sen. Ted Budd, R-North Carolina, and Rep. Eric Burlison, R-Missouri.  

The ACE Act doubles the annual amount families can take from 529 accounts to pay for K-12 expenses – from $10,000 to $20,000.  

It also raises annual tax exclusions for 529 contributions to $20,000.  

Finally, the bill would limit federal tax exemptions given to local school bonds based on the level of education freedom in each state.  

States with no school choice would receive no tax exemption, states with some choice would receive 50% exemption and states with full choice would be 100% exempt.  

Full school choice is defined as 65% of the state’s school aged children being eligible for at least one school choice program. The program must also offer at least 75% of the state’s per-pupil funding.  

A partial choice state offers 60% of funding to at least 40% of K-12 students.  

“It is the fundamental right of parents to choose the educational path that is most suitable for their children,” Lee said in a press release. “The ACE Act ensures that our tax system reflects this principle and provides real support to those seeking alternatives to public schooling.” 

Budd also understands the importance of a customized education from personal experience. 

“As a father of three children who were homeschooled, I know that kids benefit from an education that is uniquely suited to their needs,” he added. “I’m proud to cosponsor the ACE Act, which will give more parents the option to choose the education that is best for their children.” 

The ACE Act also received endorsements from notable education groups like the Home School Legal Defense Association (HSLDA), the Association of Christian Schools International (ACSI), Parents Defending Education (PDE), and Heritage Action for America, an affiliate of The Heritage Foundation.  

The measure has been referred to the Senate Finance committee.