To direct the Secretary of the Treasury to carry out a program under which Federal funds for elementary and secondary education are either provided directly to parents to cover certain educational expenses or approved by parents for distribution to the public school their child attends, and for other purposes.

of this Act or will become eligible to enroll in such a school in less than 60 days after the date of enactment of this Act, 30 days after the date determined by the Secretary of Education under section 2(a); or (B) in the case of an eligible individual who is not enrolled in an elementary or secondary school on the date of enactment of this Act and will not become eligible to enroll in such a school until at least 60 days after the date of enactment of this Act, 60 days prior to the date that such individual is eligible to attend an elementary school. (2) Authority to collect information.--The Secretary of the Treasury shall take such steps as may be necessary, including issuance of regulations if needed, to establish a process to collect the information necessary to determine whether an individual is eligible for a School Freedom Account under paragraph (1). (b) Federal Deposits.-- (1) In general.--For each school year beginning on or after July 1, 2027, in addition to any amount deposited pursuant to paragraph (3), the Secretary of the Treasury shall deposit into each School Freedom Account an amount equal to the per-pupil Federal expenditure applicable to an eligible individual for the school year, as determined under paragraph (2). (2) Per-pupil federal expenditure.-- (A) First year of program.--The per-pupil Federal expenditure applicable to an eligible individual for the first school year that begins on or after July 1, 2027, shall be equal to-- (i) the sum of the total amount of Federal funds appropriated to carry out this section for fiscal year 2027 and any amounts made available under section 2(d); divided by (ii) the total number of eligible individuals counted for such school year. (B) Subsequent years.--The per-pupil Federal expenditure applicable to an eligible individual for any school year after the year described in subparagraph (A) shall be equal to-- (i) the total amount of Federal funds appropriated to carry out this section for the fiscal year that corresponds to such school year; divided by (ii) the total number of eligible individuals counted for such school year. (3) Children with a disability.--For each school year beginning on or after July 1, 2027, in addition to the amount deposited pursuant to paragraph (1), the Secretary of the Treasury shall deposit into each School Freedom Account established on behalf of an eligible individual who is a child with a disability-- (A) for the school year beginning on July 1, 2027, $2,000; and (B) for each subsequent school year, the amount determined under this paragraph for the preceding school year, increased by the percentage increase in the Personal Consumption Expenditures price index (as published by the Bureau of Economic Analysis) for the 12-month period ending on December 31 of the previous calendar year. (4) Classification.--Funds deposited into a School Freedom Account pursuant to this subsection shall be classified as ``Federal SFA Funds''. (c) Parental Deposits.-- (1) In general.--Not later than 30 days after the date determined by the Secretary of Education under section 2(a) and consistent with the provisions of section 530B of the Internal Revenue Code of 1986, the Secretary of the Treasury shall issue regulations establishing how a parent of an eligible individual with a School Freedom Account may deposit funds into such School Freedom Account, including how such a parent may make such a deposit as a pre-tax payroll deduction. (2) Classification.--Funds deposited into a School Freedom Account in accordance with regulations issued pursuant to paragraph (1) shall be classified as ``Parental SFA Funds''. (d) State Deposits.-- (1) In general.--Not later than 30 days after the date determined by the Secretary of Education under section 2(a), the Secretary of the Treasury shall issue regulations establishing how States may deposit funds into a School Freedom Account. (2) Preemption.--Except as provided in section 4(a)(4), no State may establish any restrictions or conditions on how funds deposited by the State into a School Freedom Account may be spent. (3) Classification.--Funds deposited into a School Freedom Account in accordance with regulations issued pursuant to paragraph (1) shall be classified as ``State SFA Funds''. (e) Availability of Funds.-- (1) In general.--Not later than 30 days after the date determined by the Secretary of Education under section 2(a), the Secretary of the Treasury shall issue regulations establishing how a parent of an eligible individual with a School Freedom Account-- (A) notifies the Secretary of the Treasury that the individual is or is not attending a public elementary or secondary school for a school year; (B) in the case of a parent who elects to have the individual attend a public elementary or secondary school for a school year-- (i) approves the disbursement of the annual amount of Federal SFA Funds disbursed to the School Freedom Account pursuant to paragraphs (1) and (3) of subsection (b) to the local educational agency serving the school attended by the individual for use in accordance with subsection (f)(2); and (ii) may access any Parental SFA Funds and State SFA Funds in the School Freedom Account to pay for the educational expenses of the individual in accordance with subsection (f)(1); (C) in the case of a parent who elects to not have the individual attend a public elementary or secondary school for a school year, may access any Federal SFA Funds, Parental SFA Funds, and State SFA Funds in the School Freedom Account to pay for the educational expenses of the individual in accordance with subsection (f)(1); and (D) may submit an application to the Secretary of the Treasury to be issued a payment card connected to the School Freedom Account by the Secretary of the Treasury. (2) Default disbursement.--In the case that a parent of an eligible individual with a School Freedom Account fails to notify the Secretary of the Treasury that the individual is not attending a public elementary or secondary school for a school year or fails to approve the disbursement of Federal SFA Funds from the School Freedom Account to the local educational agency serving the school attended by the individual as required under regulations issued pursuant to paragraph (1), the Secretary of the Treasury shall disburse the annual amount of Federal SFA Funds disbursed to the School Freedom Account pursuant to paragraphs (1) and (3) of subsection (b) to the local educational agency serving the last known address of the individual. (3) Rule of construction.--Nothing in this subsection, including the regulations issued under paragraph (1), shall be construed to restrict or otherwise inhibit interdistrict enrollment. (f) Uses of Funds.-- (1) In general.--Funds deposited into a School Freedom Account (except for Federal SFA Funds required to be disbursed to a local educational agency under regulations established pursuant to subsection (e)) may be used to pay for-- (A) books, curricular material, and other instructional materials, including curriculum materials designed for a home school; (B) technological educational materials; (C) online educational materials; (D) tutoring or educational classes outside the home, including instruction as part of a micro school or learning pod; (E) private school tuition; (F) extracurricular activities; (G) testing fees; (H) a licensed or accredited paraprofessional or educational aide; (I) tuition for vocational or life skills education; (J) costs associated with an annual education plan conducted by an independent evaluation team; (K) tuition or fees for a non-public online learning program; (L) services provided by a public school, including individual classes and extracurricular programs; (M) uniforms purchased from or through a school; (N) educational or learning diagnostic tools; (O) educational therapies for a child with a disability; (P) educational and psychological evaluations; (Q) assistive technology rentals; or (R) braille translation goods and services. (2) Public school funds.--Federal SFA Funds disbursed from a School Freedom Account to a local educational agency under regulations established pursuant to subsection (e) may be used by such local educational agency for any educational purpose authorized under the laws of the State in which such local educational agency is located. (g) Limitation.--The Secretary of the Treasury may not require that-- (1) individuals obtain preapproval prior to the expenditure of amounts from a School Freedom Account; or (2) the expenditure of amounts from a School Freedom Account be through a specific marketplace or portal. SEC. 4. HIGHER EDUCATION AND SKILLS OBTAINMENT FUND PROGRAM. (a) Conversion of School Freedom Account.-- (1) Account creation.--A School Freedom Account established on behalf of an eligible individual shall be converted by the Secretary of the Treasury into a savings account to be known as a ``Higher Education and Skills Obtainment Fund'' on behalf of such individual on the earlier of the following: (A) The date on which the individual completes secondary school. (B) The date on which the individual is no longer eligible to attend a public elementary or secondary school due to the individual's age. (2) Treatment of federal sfa funds.--Any Federal SFA Funds that remain in a School Freedom Account at the time such School Freedom Account is converted into a Higher Education and Skills Obtainment Fund pursuant to paragraph (1) shall be transferred to such Higher Education and Skills Obtainment Fund and be classified as ``Federal HESOF Funds''. (3) Treatment of parental sfa funds.--Any Parental SFA Funds that remain in a School Freedom Account at the time such School Freedom Account is converted into a Higher Education and Skills Obtainment Fund pursuant to paragraph (1) shall be transferred to such Higher Education and Skills Obtainment Fund and be classified as ``Parental HESOF Funds''. (4) Treatment of state sfa funds.--Each State shall determine how funds deposited by the State into a School Freedom Account are to be treated by the Secretary of the Treasury when such School Freedom Account is converted into a Higher Education and Skills Obtainment Fund pursuant to paragraph (1), including requiring such funds to be transferred to such Higher Education and Skills Obtainment Fund and be classified as ``State HESOF Funds'' or requiring such funds to be returned to the State. (b) Withdraw of Parental HESOF Funds.--Not later than 30 days after the date determined by the Secretary of Education under section 2(a) and consistent with the provisions of section 530C of the Internal Revenue Code of 1986, the Secretary of the Treasury shall issue regulations establishing how an individual with a Higher Education and Skills Obtainment Fund may withdraw Parental HESOF Funds. (c) Use of Funds.--Funds in a Higher Education and Skills Obtainment Fund may be used to pay for the following postsecondary educational expenses: (1) Costs of attendance at an institution of higher education. (2) Costs associated with pursuing career and technical education. (3) Any other postsecondary educational expense as determined appropriate by the Secretary of the Treasury. (d) Termination.--The Secretary of the Treasury shall terminate the Higher Education and Skills Obtainment Fund of an individual on the date on which such individual attains the age of 30 years. (e) Return of Funds.-- (1) Federal funds.--Any Federal HESOF Funds remaining in a Higher Education and Skills Obtainment Fund of an individual on the date such fund terminates under subsection (d) shall be returned to the Treasury of the United States. (2) Parental hesof funds.--Any Parental HESOF Funds remaining in a Higher Education and Skills Obtainment Fund of an individual on the date such fund terminates under subsection (d) shall be provided to the individual. (3) State hesof funds.--Any State HESOF remaining in a Higher Education and Skills Obtainment Fund of an individual on the date such fund terminates under subsection (d) shall be disbursed as specified by the State under subsection (a)(4). (4) Regulations.--Not later than 180 days after the date determined by the Secretary of Education under section 2(a), the Secretary of the Treasury shall issue regulations as necessary to carry out this subsection. (f) Limitation.--The Secretary of the Treasury may not require that-- (1) individuals obtain preapproval prior to the expenditure of amounts from a Higher Education and Skills Obtainment Fund; or (2) the expenditure of amounts from a Higher Education and Skills Obtainment Fund be through a specific marketplace or portal. SEC. 5. TAX TREATMENT OF SCHOOL FREEDOM ACCOUNTS AND HIGHER EDUCATION AND SKILLS OBTAINMENT FUNDS. (a) In General.--Part VIII of subchapter F of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new sections: ``SEC. 530B. SCHOOL FREEDOM ACCOUNTS. ``(a) Treatment of Accounts.-- ``(1) In general.--A School Freedom Account is exempt from taxation under this subtitle unless such account has ceased to be a School Freedom Account. Notwithstanding the preceding sentence, any such account is subject to the taxes imposed by section 511 (relating to imposition of tax on unrelated business income of charitable, etc. organizations). ``(2) Account terminations.--Rules similar to the rules of paragraphs (2) and (4) of section 408(e) shall apply to School Freedom Accounts, and any amount treated as distributed under such rules shall be treated as not used to pay qualified expenses. ``(b) Treatment of Contributions.-- ``(1) Deduction for contributions by parents of account beneficiary.--In the case of a contribution to a School Freedom Account made by a parent of the beneficiary of such Account during the taxable year (other than any contribution to which paragraph (2) applies), there shall be allowed to such parent a deduction for such taxable year an amount equal to such contribution. ``(2) Exclusion of employer contributions.--In the case of an employee who is the parent of a beneficiary of a School Freedom Account, gross income of such employee (and of such beneficiary) does not include amounts contributed by such employee's employer to such Account. ``(c) Treatment of Distributions.-- ``(1) Amounts used for qualified expenses.--Any amount paid or distributed out of a School Freedom Account which is used exclusively to pay qualified expenses of any account beneficiary shall not be includible in gross income. ``(2) Inclusion of amounts not used for qualified expenses.--Any amount paid or distributed out of a School Freedom Account which is not used exclusively to pay the qualified expenses of the account beneficiary shall be included in the gross income of such beneficiary. ``(3) Penalties for distributions not used for qualified expenses.-- ``(A) Penalties.-- ``(i) Tax penalties.--The tax imposed by this chapter on the account beneficiary for any taxable year in which there is a payment or distribution from a School Freedom Account of such beneficiary which is includible in gross income under paragraph (2) shall be increased by-- ``(I) in the case of the first such payment or distribution, 20 percent of the amount which is so includible, and ``(II) in the case of any subsequent such payment or distribution, 50 percent of the amount which is so includible. ``(ii) Criminal penalties.--In the case of the third payment or distribution to which clause (i) applies (and each such payment or distribution subsequent to such third payment or distribution), in addition to any penalty imposed under clause (i), such beneficiary may be imprisoned for up to 1 year for each such payment or distribution. ``(B) Exception for disability or death.-- Subparagraph (A) shall not apply if the payment or distribution is made after the account beneficiary becomes disabled within the meaning of section 72(m)(7) or dies. ``(4) Special rule for minors.--In the case of any account beneficiary who has not attained age 18-- ``(A) paragraphs (2) and (3) shall be applied by substituting `the individual who authorized such distribution on behalf of the account beneficiary' for `such beneficiary' each place it appears, and ``(B) clauses (i) and (ii) of paragraph (3)(A) shall be applied separately with respect to each such individual who authorizes distributions on behalf of an account beneficiary. ``(5) Treatment after death of account beneficiary.-- ``(A) Treatment if designated beneficiary is spouse.--If the account beneficiary's surviving spouse acquires such beneficiary's interest in a School Freedom Account by reason of being the designated beneficiary of such account at the death of the account beneficiary, such School Freedom Account shall be treated as if the spouse were the account beneficiary. ``(B) Other cases.-- ``(i) In general.--If, by reason of the death of the account beneficiary, any person acquires the account beneficiary's interest in a School Freedom Account in a case to which subparagraph (A) does not apply-- ``(I) such account shall cease to be a School Freedom Account as of the date of death, and ``(II) an amount equal to the fair market value of the assets in such account on such date shall be includible if such person is not the estate of such beneficiary, in such person's gross income for the taxable year which includes such date, or if such person is the estate of such beneficiary, in such beneficiary's gross income for the last taxable year of such beneficiary. ``(ii) Special rules.-- ``(I) Reduction of inclusion for predeath expenses.--The amount includible in gross income under clause (i) by any person (other than the estate) shall be reduced by the amount of qualified expenses which were incurred by the decedent before the date of the decedent's death and paid by such person within 1 year after such date. ``(II) Deduction for estate taxes.--An appropriate deduction shall be allowed under section 691(c) to any person (other than the decedent or the decedent's spouse) with respect to amounts included in gross income under clause (i) by such person. ``(d) Definitions.--For purposes of this section-- ``(1) School freedom account.--The term `School Freedom Account' means a School Freedom Account within the meaning of section 3 of the School Freedom Act of 2026. ``(2) Qualified expenses.--The term `qualified expenses' means the expenses described in section 3(f)(1) of the School Freedom Act of 2026. Any distribution required to be made to a local educational agency under section 3 of the School Freedom Act of 2026 shall be treated as used for qualified expenses. ``SEC. 530C. HIGHER EDUCATION AND SKILLS OBTAINMENT FUNDS. ``(a) Treatment of Accounts.-- ``(1) In general.--A Higher Education and Skills Obtainment Fund is exempt from taxation under this subtitle unless such account has ceased to be a Higher Education and Skills Obtainment Fund. Notwithstanding the preceding sentence, any such account is subject to the taxes imposed by section 511 (relating to imposition of tax on unrelated business income of charitable, etc. organizations). ``(2) Account terminations.--Rules similar to the rules of paragraphs (2) and (4) of section 408(e) shall apply to Higher Education and Skills Obtainment Fund, and any amount treated as distributed under such rules shall be treated as not used to pay qualified expenses. ``(b) Treatment of Distributions.-- ``(1) Amounts used for qualified expenses.--Any amount paid or distributed out of a Higher Education and Skills Obtainment Fund which is used exclusively to pay qualified expenses of any account beneficiary shall not be includible in gross income. ``(2) Inclusion of amounts not used for qualified expenses.--Any amount paid or distributed out of a Higher Education and Skills Obtainment Fund which is not used exclusively to pay the qualified expenses of the account beneficiary shall be included in the gross income of such beneficiary. ``(3) Penalties for distributions not used for qualified expenses.-- ``(A) Penalties.-- ``(i) Tax penalties.--The tax imposed by this chapter on the account beneficiary for any taxable year in which there is a payment or distribution from a Higher Education and Skills Obtainment Fund of such beneficiary which is includible in gross income under paragraph (2) shall be increased by-- ``(I) in the case of the first such payment or distribution, 20 percent of the amount which is so includible, and ``(II) in the case of any subsequent such payment or distribution, 50 percent of the amount which is so includible. ``(ii) Criminal penalties.--In the case of the third payment or distribution to which clause (i) applies (and each such payment or distribution subsequent to such third payment or distribution), in addition to any penalty imposed under clause (i), such beneficiary may be imprisoned for up to 1 year for each such payment or distribution. ``(iii) Prior non-qualified distributions from school freedom account taken into account.--For purposes of clauses (i) and (ii), any payment or distribution from a School Freedom Account to which section 530B(c)(3)(A)(i) applies shall be treated as payment or distribution to which clause (i) of this subparagraph applies if such School Freedom Account was converted into the Higher Education and Skills Obtainment Fund with respect to which clause (i) applies. ``(B) Exception for distribution of parental sfa funds.--Subparagraph (A) shall not apply to distributions properly attributable (as determined under regulations or other guidance issued by the Secretary) to Parental SFA Funds transferred to the Higher Education and Skills Obtainment Fund under section 4(a)(3) of the School Freedom Act of 2026. ``(C) Exception for disability or death.-- Subparagraph (A) shall not apply if the payment or distribution is made after such beneficiary becomes disabled within the meaning of section 72(m)(7) or dies. ``(4) Special rule for minors.--In the case of any account beneficiary who has not attained age 18-- ``(A) paragraphs (2) and (3) (other than paragraph (3)(C)) shall be applied by substituting `the individual who authorized such distribution on behalf of the account beneficiary' for `such beneficiary' each place it appears, and ``(B) clauses (i), (ii), and (iii) of paragraph (3)(A) shall be applied separately with respect to each such individual who authorizes distributions on behalf of an account beneficiary. ``(5) Treatment after death of account beneficiary.-- ``(A) Treatment if designated beneficiary is spouse.--If the account beneficiary's surviving spouse acquires such beneficiary's interest in a Higher Education and Skills Obtainment Fund by reason of being the designated beneficiary of such account at the death of the account beneficiary, such Higher Education and Skills Obtainment Fund shall be treated as if the spouse were the account beneficiary. ``(B) Other cases.-- ``(i) In general.--If, by reason of the death of the account beneficiary, any person acquires the account beneficiary's interest in a Higher Education and Skills Obtainment Fund in a case to which subparagraph (A) does not apply-- ``(I) such account shall cease to be a Higher Education and Skills Obtainment Fund as of the date of death, and ``(II) an amount equal to the fair market value of the assets in such account on such date shall be includible if such person is not the estate of such beneficiary, in such person's gross income for the taxable year which includes such date, or if such person is the estate of such beneficiary, in such beneficiary's gross income for the last taxable year of such beneficiary. ``(ii) Special rules.-- ``(I) Reduction of inclusion for predeath expenses.--The amount includible in gross income under clause (i) by any person (other than the estate) shall be reduced by the amount of qualified expenses which were incurred by the decedent before the date of the decedent's death and paid by such person within 1 year after such date. ``(II) Deduction for estate taxes.--An appropriate deduction shall be allowed under section 691(c) to any person (other than the decedent or the decedent's spouse) with respect to amounts included in gross income under clause (i) by such person. ``(c) Definitions.--For purposes of this section-- ``(1) Higher education and skills obtainment fund.--The term `Higher Education and Skills Obtainment Fund' means a Higher Education and Skills Obtainment Fund within the meaning of section 4 of the School Freedom Act of 2026. ``(2) Qualified expenses.--The term `qualified expenses' means the expenses described in section 4(c) of the School Freedom Act of 2026. Any distributions returned to the Treasury under section 4(e)(1) of School Freedom Act of 2026 shall be treated as used for qualified expenses.''. (b) Deduction Allowed Whether or Not Individual Elects To Itemize Deductions.--Section 62(a) of such Code is amended by inserting after paragraph (21) the following new paragraph: ``(22) School freedom accounts.--The deduction allowed by section 530B(b)(1).''. (c) Clerical Amendment.--The table of sections for part VIII of subchapter F of chapter 1 of such Code is amended by adding at the end the following new items: ``Sec. 530B. School Freedom Accounts. ``Sec. 530C. Higher Education and Skills Obtainment Funds.''. (d) Effective Date.--The amendments made by this section shall apply to taxable years ending after the date of the enactment of this Act. SEC. 6. TRACKING OF FEDERAL EDUCATION FUNDS. Before the end of each school year, the Secretary of the Treasury shall determine-- (1) the aggregate amount of deposits made to School Freedom Accounts under section 3 for such school year, categorized by-- (A) whether such deposit was made by the Secretary of the Treasury, a parent, or a State; and (B) the local educational agency of the account holder; and (2) of the amounts measured and categorized under paragraph (1), with respect to each local educational agency-- (A) the amount made available to parents in accordance with the regulations issued pursuant to section 3(e)(1); and (B) the amount of funds disbursed to the local educational agency in accordance with the regulations issued pursuant to section 3(e)(1) and with section 3(e)(2). SEC. 7. RULE OF CONSTRUCTION. Nothing in this Act shall be construed to-- (1) affect any aspect of private, religious, or home education providers; (2) exclude private, religious, or home education providers from receiving funds from a School Freedom Account; or (3) require an educational service provider to alter any creed, practice, admissions policy, or curriculum in order to receive funds from a School Freedom Account. SEC. 8. PROHIBITION ON REGULATIONS. Except as authorized by this Act, the Secretary of the Treasury may not issue any rule, promulgate any regulation, or take any other action which imposes any limitation or requirement on the use of a School Freedom Account or Higher Education and Skills Obtainment Fund by a parent or eligible individual. SEC. 9. GAO REPORTING ON SCHOOL FREEDOM ACCOUNT AND HIGHER EDUCATION AND SKILLS OBTAINMENT FUND. (a) One-Time Report.--Not later than 18 months after the date of enactment of this Act, the Comptroller General of the United States shall submit a report to Congress that contains the following information: (1) A review of the wind-down and termination of covered Federal education programs by the Secretary of Education. (2) The reallocation of unobligated amounts originally appropriated for covered Federal education programs to carry out the School Freedom Account program under section 3, as required by section 2(d). (3) A summary of the regulations established by the Secretary of the Treasury under section 3(e)(1). (b) Annual Report.--Not later than 1 year after the date of enactment of this Act, and annually thereafter, the Comptroller General of the United States shall submit a report to Congress that contains the following information: (1) The most recent annual data collected pursuant to section 6. (2) An assessment of whether any additional uses of funds for a School Freedom Account or Higher Education and Skills Obtainment Fund could benefit the education of eligible individuals. (3) An analysis of how the Secretary of the Treasury is tracking Federal funds deposited into School Freedom Accounts. (4) Based on the most recent data available at the time such report is submitted, and to the extent such data is available-- (A) the annual number of students who expended funds from a School Freedom Account to-- (i) attend a private school; (ii) attend a public charter school; (iii) attend a homeschool; or (iv) attend educational classes outside the home, including as part of a micro school or learning pod; (B) the aggregate annual amount of funds expended by parents from School Freedom Accounts for a purpose other than an eligible uses under section 3(f)(1); (C) the aggregate amount of funds in School Freedom Accounts that rolled over to the subsequent school year; (D) the number of School Freedom Accounts that converted to Higher Education and Skills Obtainment Funds and the aggregate amount in accounts that converted; (E) the aggregate number of eligible individual who expend amounts from a Higher Education and Skills Obtainment Fund to pay costs associated with attendance of an institution of higher education or towards career and technical education; and (F) the aggregate annual amount of funds from Higher Education and Skills Obtainment Funds that were returned to the Treasury. (5) Any other information the Comptroller General determines important to assessing and improving the implementation or administration of the School Freedom Account program or the Higher Education and Skills Obtainment Fund program. SEC. 10. DEFINITIONS. In this Act: (1) Career and technical education.--The term ``career and technical education'' has the meaning given that term in section 3 of the Carl D. Perkins Career and Technical Education Act of 2006 (20 U.S.C. 2302). (2) Child with a disability.--The term ``child with a disability'' has the meaning given that term in section 602 of the Individuals with Disabilities Education Act (20 U.S.C. 1401). (3) Cost of attendance.--The term ``cost of attendance'' has the meaning given that term in section 472 of the Higher Education Act of 1965 (20 U.S.C. 1087ll). (4) Covered federal education program.--The term ``covered Federal education program'' means an applicable program (as defined in section 400 of the General Education Provisions Act (20 U.S.C. 1221)) the primary purpose of which is to support elementary or secondary education, except such term does not include the School Freedom Account program authorized under this Act. (5) Eligible individual.--The term ``eligible individual'' means, with respect to a School Freedom Account, an individual who-- (A) has not completed secondary school; (B) is or will become eligible to attend a elementary or secondary school; (C) is a citizen or national of the United States; and (D) has at least 1 parent that is a citizen or national of the United States. (6) ESEA terms.--The terms ``child'', ``elementary school'', ``local educational agency'', ``parent'', ``secondary school'', and ``State'' have the meanings given those terms in section 8101 of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 7801). (7) Institution of higher education.--The term ``institution of higher education'' has the meaning given that term in section 102 of the Higher Education Act of 1965 (20 U.S.C. 1002). <all>