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The Senate Finance Committee recently passed 529 legislation identical to a bill approved by the House of Representatives in February. Chairman Orrin Hatch (R-UT) urged committee approval of the House-passed bill to expedite final passage. He met some objection from Ranking Member Ron Wyden (D-OR), who said the committee should not act as a "rubber stamp" for House-passed legislation. Despite Wyden's sentiment, the committee ultimately approved the measure.

As passed by the committee, S.335 would include computers and Internet access in the definition of qualified education expenses, address problems with so-called aggregation rules, and allow students to recontribute funds to their accounts without any penalties under certain circumstances.

The committee also acknowledged problems surrounding the penalty notices sent to colleges and universities regarding Forms 1098-T. During a committee markup on April 29, Chairman Hatch noted, "It is my understanding that the IRS has waived fines for the 2011 tax year for colleges and universities that filed the tuition statement forms with missing or incorrect taxpayer identification numbers. It does appear that fines for the 2012 tax year also have been assessed and this continuing uncertainty is bad for all parties involved."

This was in response to Sen. Dan Coats (R-IN), who discussed, but did not formally offer two related amendments. The first would provide for a waiver of penalties for higher education institutions that act reasonably to obtain taxpayer identification numbers (TINs) of students. The second amendment targets improper payments of higher education tax benefits.

Coats remains interested in addressing the cycle of proposed fines, waiver requests and notices of delayed response related to Forms 1098-T. NACUBO continues to work with his office and others to seek a remedy.

As previously reported, NACUBO members can help by informing us of IRS actions. While we don't need to know about routine correspondence, such as computer-generated letters saying 60 more days are needed to review your waiver request, NACUBO staff would like to know about:

  • Notices turning down a request for waiver of fines for missing or incorrect TINs on 1098-Ts (not 1099s or W-2s).
  • Demands for payment of fines related to 1098-Ts for either 2011 or 2012.
  • Debt offsets or asset seizures.

Please send information and inquiries to


Liz Clark

Vice President, Policy and Research


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