What is a 529 plan?
It’s an education savings plan operated by a state or education institution designed to help families set aside funds for future college costs. 529 plans are usually categorized as either prepaid or savings, although some have elements of both. Every state now has at least one 529 plan available. Your investment grows tax-deferred and distributions to pay for the beneficiary’s qualified college costs come out federally tax-free. The tax-free treatment was recently made permanent with the Pension Protection Act of 2006. As far as financial aid treatment, 529 plans are considered an asset of the parent, not the student. Better yet, any distributions taken from a 529 savings plan does not have to be added back as untaxed income on the federal financial aid app (FAFSA). You stay in control of the account. You decide when withdrawals are made and for what purpose. Most plans even allow you to reclaim the money for yourself at anytime, for example, if the student decides not to pursue higher
A 529 plan is an education savings plan operated by a state or an educational institution and designed to help families set aside funds for college. It is named after Section 529 of the Internal Revenue Code, which authorized these types of tax-advantaged savings plans in 1998. 529 plans offer unsurpassed income tax breaks. Although your contributions are not deductible on your federal tax return, your investment’s earnings are tax-deferred; your withdrawals for “qualified higher education expenses” are free from federal income taxes; and your savings can be used at thousands of accredited colleges and vocational schools across the country. (Unqualified withdrawals may be taxable as ordinary income and subject to a 10% federal tax penalty.) The Pension Protection Act of 2006 made the tax-free character of 529s a permanent part of federal law. Everyone can take advantage of a 529 plan, and the amounts you can invest are substantial (more than $300,000 per beneficiary in many state plans
A 529 Plan is an education savings plan administered by the Wisconsin State Treasurer’s Office and managed by Wells Fargo Funds Management, LLC designed to help families set aside funds for future college costs. It is named after Section 529 of the Internal Revenue Code which created these types of savings plans in 1998. Our Plan EdVest works much like a 401K or IRA by investing your contributions in mutual funds or similar investments. Our plan will offer you 15 investment options from which to choose. You can invest in aggressive stock portfolios, blended portfolios of stocks and bonds, and even a CD portfolio depending on your preference. Your account will go up or down in value based on the performance of the particular option you select. Eligibility and Coverage • Parents, grandparents, aunts, uncles, trusts, guardians–anyone can open an account [as long as you’re 18 or over]. • There is no enrollment fee. • Anyone can contribute to an open account. • Individuals can open account
