U.S. House Proposal Seeks Employer Education Contributions

July 3, 2007 (PLANSPONSOR.com) - A recent proposal introduced in the U.S. House of Representatives is meant to propel employees to allocate money for education costs and prompt employers to contribute matching funds.

The bill, introduced by Representative Thomas Allen, (D-Maine), would set up Lifelong Learning Accounts, into which employers and employees would contribute.   The accounts mirror a 401(k) in concept, but are for skill building and career advancement rather than retirement, according to a news release.

“Stunning advances in science and technology are creating exciting opportunities for American businesses and American workers,” said Allen, in the news release. “But to take advantage of the promise these innovations hold and for America to remain competitive in the global economy, we must have a workforce with the education and training to fill the jobs businesses create.”

The Lifelong Learning Account Act would provide tax credits for employer and employee contributions to Lifelong Learning Accounts in up to ten states for up to 200,000 workers. Also, the funds in these accounts would finance a wide range of educational activities.

The act would also provide for deductions for employee contributions for amounts that exceed the tax credit.

Two legislators introduced a similar bill in the U.S. Senate in January.