16-05-2025
ASTA supports legislation to expand 529 plans and preserve tax deduction
ASTA is voicing support for the Freedom to Invest in Tomorrow's Workforce Act, which would make permanent a tax deduction that many advisors use, plus widen the qualified expenses for 529 savings plans.
The legislation advanced through the House Ways and Means Committee on May 14, ASTA said.
If the bill becomes law, 529 funds -- primarily used to pay for college tuition -- could be used to cover travel agent training and credentialing. That includes licenses and certifications, ASTA said, including its own Verified Travel Advisor program.
It would also make permanent the Section 199A tax deduction at 23%. According to ASTA, under the 2017 Tax Cuts and Jobs Act, Section 199A enables eligible businesses to deduct 20% of their qualified business income. That lessens their tax liability. Right now, the deduction is set to expire at the end of the year.
Many ASTA members use the deduction. Based on a recent survey, the Society found that 87% of respondents said it was "moderately significant" (21%) or "very significant" (66%) to reduce their tax liability. Close to 80% said without the deduction, they would have to change their business in some way, whether in the form of staff reductions, fee increases, reduced spending or retirement.
In a recent letter to the Ways and Means Committee, ASTA president and CEO Zane Kerby said around half of all advisors qualify for the deduction.
"It has allowed for substantial tax savings for these members, many of whom are small business owners that count every penny," Kerby wrote. "These tax savings have allowed them to further invest in their business and in the communities in which they live and work."
