; and , and inserting after paragraph (16) the following: (17) There shall be excluded any contribution made to or on behalf of an employee that is not includible in gross income of the employee under section 139G of the Internal Revenue Code of 1986. . (c) Railroad retirement Section 3231(e) of such Code is amended by adding at the end the following: (13) Employer contributions to 529 plan or ABLE account The term compensation shall not include any contribution made to or on behalf of an employee that is not includible in gross income of the employee under section 139G. . (d) Deduction for individual contributions (1) In general Part VII of subchapter B of chapter 1 of the Internal Revenue Code of 1986 is amended by redesignating section 224 as section 225 and by inserting after section 223 the following new section: 224. Contributions to 529 plans and ABLE accounts (a) Allowance of deduction In the case of an individual, there shall be allowed as a deduction for the taxable year an amount equal to the sum of— (1) the aggregate contributions made by such individual to qualified tuition programs (as defined in section 529) during such taxable year, and (2) the aggregate contributions made by such individual to ABLE accounts (as defined in section 529A) during such taxable year. (b) Limitation The amount allowed as a deduction by subsection (a) for a taxable year shall not exceed $5,000. . (2) Clerical amendment The table of sections for part VII of subchapter B of chapter 1 of such Code is amended by redesignating the item relating to section 224 as an item relating to section 225 and by inserting after the item relating to section 223 the following new item: Sec. 224. Contributions to 529 plans and ABLE accounts. . (e) Effective date The amendments made by this section shall apply to contributions made during taxable years beginning after the date of the enactment of this Act. 3. Additional tax for distributions not used for qualified purposes (a) Qualified tuition programs (1) In general The first sentence of