Higher Education Funding Act of 1977

Higher Education Funding Act of 1977 - Amends the Internal Revenue Code to allow an income tax deduction for contributions to a qualified higher education fund established by the taxpayer to fund the higher education of his dependents. Limits the amount of the deduction to the lesser of: (1) $750 times the number of qualified beneficiaries; (2) 15 percent of the taxpayer's adjusted gross income; or (3) $7,500.

Provides that a qualified education fund must be established by the taxpayer pursuant to a written plan: (1) which is designed to defray the cost of room, board, and tuition of one or more eligible beneficiaries at an institution of higher education; (2) which provides that no distribution shall be made by the fund (except upon termination) other than to, or on behalf of, eligible beneficiaries; (3) which provides that upon termination of the fund all assets of the fund shall be distributed to the taxpayer or to his estate; (4) which prohibits contributions to the fund in excess of amounts deductible; and (5) under which the taxpayer includes in gross income certain amounts attributable to the fund upon termination of such fund.