article: SECTION 1. DEDUCTION FOR POSTSECONDARY EDUCATION EXPENSES. (a) Deduction Allowed.--Part VII of subchapter B of chapter 1 of the Internal Revenue Code of 1986 (relating to additional itemized deductions for individuals) is amended by redesignating section 220 as section 221 and by inserting after section 219 the following new section: ``SEC. 220. POSTSECONDARY EDUCATION EXPENSES. ``(a) Allowance of Deduction.--In the case of an individual, there shall be allowed as a deduction an amount equal to the qualified postsecondary education expenses paid by the taxpayer during the taxable year. ``(b) Dollar Limitations.-- ``(1) Per student.--The aggregate payments during the taxable year for the qualified postsecondary education expenses of each individual which may be taken into account under subsection (a) shall not exceed $10,000. ``(2) Per taxpayer.--The amount allowed as a deduction under subsection (a) for the taxable year shall not exceed $20,000. ``(c) Definitions.--For purposes of this section-- ``(1) Qualified postsecondary education expenses.--The term `qualified postsecondary education expenses' means qualified tuition and related expenses of-- ``(A) the taxpayer, or ``(B) an individual who is the spouse, or a dependent, of the taxpayer for the taxable year in which such expenses are incurred, for attendance at an eligible educational institution. ``(2) Qualified tuition and related expenses.--The term `qualified tuition and related expenses' means-- ``(A) tuition and fees required for enrollment or attendance at an eligible educational institution, ``(B) fees, books, supplies, and equipment required for courses of instruction at such an institution, and ``(C) reasonable living expenses while away from home. Such term shall not include expenses which are treated as not described in section 135(c)(2)(A) by reason of section 135(c)(2)(B). ``(3) Eligible educational institution.--The term `eligible educational institution' has the meaning given to such term by section 135(c)(3). ``(d) Coordination With Other Provisions.-- ``(1) No double benefit.-- ``(A) In general.--No deduction shall be allowed under subsection (a) for qualified postsecondary education expenses with respect to which a deduction is allowed under any other provision of this chapter. ``(B) Savings bond exclusion.--A deduction shall be allowed under subsection (a) for qualified postsecondary education expenses only to the extent the amount of such expenses exceeds the amount excludable under section 135 for the taxable year. ``(e) Special Rules.-- ``(1) Adjustment for certain scholarships and veterans benefits.--The amounts otherwise taken into account under subsection (a) as qualified postsecondary education expenses of any individual during any period shall be reduced (before the application of subsection (b)) by any amounts received by such individual during such period as-- ``(A) a qualified scholarship (within the meaning of section 117(b)) which under section 117 is not includible in gross income, or ``(B) an educational assistance allowance under chapters 30, 31, 32, 34, or 35 of title 38 of the United States Code. ``(2) Eligible courses.--Amounts paid for qualified postsecondary education expenses of any individual shall be taken into account under subsection (a) only to the extent such expenses are attributable to courses of instruction for which credit is allowed toward a degree by an institution of higher education or toward a certificate of required course work at a vocational school. ``(3) Individual must be at least a half-time student.--No deduction shall be allowed under subsection (a) for amounts paid during the taxable year for qualified postsecondary education expenses with respect to any individual unless that individual, during any 4 calendar months during the calendar year in which the taxable year of the taxpayer begins, is at least a half-time student at an eligible education institution. ``(4) Taxpayer who is dependent of another taxpayer.--No deduction shall be allowed to a taxpayer under subsection (a) for amount paid for the education of such taxpayer if such taxpayer is a dependent of another person for a taxable year beginning in the calendar year in which the taxable year of the taxpayer begins. ``(5) Spouse.--No deduction shall be allowed under subsection (a) for amounts paid during the taxable year for qualified postsecondary education expenses for the spouse of the taxpayer unless-- ``(A) the taxpayer is entitled to an exemption for his spouse under section 151(b) for the taxable year, or ``(B) the taxpayer files a joint return with his spouse for the taxable year.'' (b) Deduction Allowed in Computing Adjusted Gross Income.--Section 62(a) of such Code is amended by inserting after paragraph (15) the following new paragraph: ``(16) Postsecondary education expenses.--The deduction allowed by section 220.'' (c) Conforming Amendment.--The table of sections for part VII of subchapter B of chapter 1 of such Code is amended by striking the item relating to section 220 and inserting: ``Sec. 220. Postsecondary education expenses. ``Sec. 221. Cross reference.'' (d) Effective Dates.--The amendments made by this section shall apply to taxable years beginning after December 31, 1994.
summary: Amends the Internal Revenue Code to allow an income tax deduction for qualified postsecondary education expenses of the taxpayer or the taxpayer's spouse or dependent.