Montgomery GI Bill Improvements Act of 2005

Montgomery GI Bill Improvements Act of 2005 - Amends the Montgomery GI Bill to authorize enhanced educational assistance to a member of the Armed Forces who, after September 30, 2005: (1) first enters on active duty; (2) reenlists or continues to serve on active duty; (3) serves a continuous period of active duty of four years; or (4) serves and is discharged or released for a service-connected disability, at the convenience of the Government (after serving at least 42 months of such duty), or due to a reduction in force. Limits to 36 months the period for such enhanced assistance. Requires the payment of educational expenses under such program. Provides a monthly stipend for approved programs of education.

Increases the rates of basic educational assistance.

Repeals, with respect to such assistance: (1) a required monthly reduction in pay for individuals who do not elect to participate in such assistance program; (2) a provision authorizing individuals to elect not to receive such assistance; and (3) the requirement that participants complete the requirements of a high school diploma or equivalency certificate prior to the end of their initial obligated period of service in order to be eligible to receive such assistance. Excludes educational assistance payments from income for purposes of eligibility for Federal educational loans.

Repeals the ten-year delimiting date for use of entitlement to basic educational assistance for: (1) veterans; (2) Selected Reserve members; and (3) members of the reserve components called or ordered to active service in response to a war or national emergency.

Eliminates: (1) with respect to transfer of basic educational assistance to a dependent by a member of the Armed Forces with critical skills the requirements that such skill or specialty be designated by the Secretary concerned as eligible for such transfer; and (2) with respect to accelerated payments of basic educational assistance the requirement that the individual is enrolled in a program leading to employment in a high technology occupation.

Increases student loan program repayment amounts for active duty and Selected reserve members. Limits total repayment amounts for: (1) active duty members with specialties to $40,000; and (2) Selected Reserve members with specialties to $20,000.