A bill to amend the Internal Revenue Code of 1954 to allow a deduction for contributions to an educational fund for the benefit of the taxpayer's children.

[AI summary unavailable — showing source text] Amends the Internal Revenue Code to allow an income tax deduction for contributions to a qualified higher education fund established by a taxpayer for the purpose of funding the higher education of a dependent child under age 30. Limits the allowable deduction to $1,500 times the number of dependent children who are eligible beneficiaries of the fund. Requires that a qualified education fund must be established pursuant to a written plan which: (1) provides payment solely for tuition, fees, necessary textbooks, room and board, and other education-related expenses; (2) allows the creator of the fund no reversionary interest; and (3) limits the amount which is distributable in a calendar year to that needed to cover tuition costs plus $4,000, with cost- of-living adjustments, for living expenses. Defines "eligible postsecondary institution" as a college, university, or vocational school. Requires the termination of an education trust if yearly contributions to such trust exceed the amount of the deduction allowed each year, if funds are diverted from the trust for noneducational purposes, or if there are no eligible beneficiaries at the beginning of a taxable year. Requires that fund…