IEP means Individualized Education Program. It is a term described in a federal education law, known as IDEA - which is the Individuals with Disabilities Education Act. Sometimes you will see a date after "IDEA", such as "IDEA 2004", because that's when the last set of amendments were made to the law by Congress. Section 504 refers to a portion of a federal civil rights law, the Rehabilitation Act of 1973, which was not specifically written to cover education and school.
The purposes of IDEA are, at a minimum, "to ensure that all children with disabilities have available to them a free appropriate public education [FAPE] that emphasizes special education and related services designed to meet their unique needs and prepare them for further education, employment and independent living" and "to ensure that the rights of children with disabilities and parents of such children are protected", and "to assess, and ensure the effectiveness of, efforts to educate children with disabilities".
IDEA requires an IEP to be written for children who qualify, and the IEP must include specifics about what services the child will receive and how often, the goals for the child, the degree to which the child will be educated with children who do not have disabilities, and so on. IDEA requires that children be educated in the Least Restrictive Environment (LRE) possible, which means included in regular programs, classrooms and learning to the extent possible.
The purpose of Section 504 is to protect individuals with disabilities from discrimination for reasons related to their disabilities. The law covers programs and activities receiving or benefiting from federal financial assistance, which includes schools. Schools must provide children who have specific disabilities with reasonable accommodations comparable to those provided to their peers.
Whereas a 504 plan refers to accommodations, special education refers to services. It does not refer to a place. A child who receives special education services can be fully included in his or her home classroom and receive supports and services such as:
• Occupational therapy
• Anger management training
• A "safe" place in the building where he can go to cool down
• Transportation to and from school
• Extended school year
These services and supports will be written down into a legally binding document, called an Individualized Education Program (IEP). IEPs can be reviewed and revised any time the parents choose, but at a minimum, every three years.
Children who meet specific criteria can qualify for receiving special education services under one of several categories. The most frequently used categories for children with mood, behavior and emotional disorders are "Otherwise Health Impaired" or OHI "Emotional Impairment" or EI and "Specific Learning Disability" or SLD.
Sometimes children with Asperger's Syndrome or Autism exhibit similar difficult behaviors, and these children would qualify for special education services under "Autism Spectrum Impairment" or ASI. Typically in the mental health world, these are considered developmental disabilities and not serious emotional disabilities.