Today, the Union of Orthodox Jewish Congregations of America, through its Institute for Public Affairs, applauded the United States Senate’s approval of legislation sponsored by Senators Paul Coverdell (R-GA) and Bob Torricelli (D-NJ) providing tax free investment opportunities for money to be used toward education expenses. The measure passed on a bipartisan vote of 61 to 37.

S.1134 permits parents to invest up to $2000 in a tax free IRA account each year after the birth of a child. (Middle income taxpayers eligible for the $500 child tax credit could contribute up to $2500 annually.)

Parents could withdraw money invested in the IRA for use towards a broad range of primary, secondary or college education expenses including tuition, activity fees, supplies, tutoring or transportation costs. The legislation will permit parents to use these funds to further their children’s education at any school – public, private, sectarian or home school.

IPA director Nathan Diament expressed the support of the Orthodox Jewish community for his initiative. In connection with the Senate action, he stated that “we believe this legislation would provide meaningful support to parents in their struggle to provide the best education to their children.” Mr. Diament continued: “America already has tax-free education savings accounts for college education expenses and we all realize that the early years of education are where the foundation for a better life is built. We must support parents in their effort to provide the best K-12 education for their kids as they see fit – whether in public, private or parochial schools. We hope the House will act quickly to pass this measure and that the President will sign it into law.”