529 plan tax breaks overwhelmingly benefit whites since participation requires spare income

Evidence

In 1996, 529 plans that provide favorable tax treatment for certain college savings accounts were approved by Congress. Money deposited into the account by parents or other family members is from after-tax dollars, and the investment income is not taxed as the account grows. In addition, any withdrawals for tuition, books, and room and board are treated as tax-free intrafamily gifts. To participate, of course, a family must have extra income to set aside, and as of 2012, only about 3 percent of Americans were saving for college using a tax-preferred account, according to the Government Accountability Office. Of those, 84 percent were white and 5 percent were black. A Federal Reserve study showed that the average black family’s balance was 27,068, while the average white family's balance was 40,786. — Dorothy A. Brown, The Whiteness of Wealth, 322

Categorization

• XREF: One of the four race-neutral provisions with concrete mechanism: eligibility requires disposible income, so subsidy is regressive — exactly the structure reader must name.
• QUESTION: Verify the 84% white / 5% black participation split and whether later GAO data update it.