How are the College Illinois! Prepaid Tuition Program plans treated under federal estate tax laws?
Contributions below the annual gift tax threshold ($13,000 single, or $26,000 for married couples) are immediately removed from the donor’s gross taxable estate (and included in the estate of the beneficiary). Additionally, contributions to section 529 plans are considered a completed gift of a present interest and so are excluded from the donor’s gross estate. Contributions above the threshold are included in the donor’s gross estate only if the account owner cancels the account or the donor dies during the five year averaging period. If the donor dies during the five year period, the contributions are counted in his or her estate pro-rata according to the number of remaining years, not including the year in which the donor died. *Please see the Master Agreement and Disclosure Statement for details regarding tax advantages and implications. The College Illinois! Prepaid Tuition Program cannot provide purchasers with any legal or tax advice. Purchaser should consult their own tax advis
Related Questions
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