529 prepaid tuition plan

529 College Savings Plan

An account into which persons deposit funds to save for university-related expenses. The funds in a 529 college savings account are tax-deferred and, if used directly to pay for college, tax exempt at the federal level. They are sometimes exempt at the state level as well. The plan exists in an attempt to make post-secondary education more affordable. See also: IRA, 401(k).

529 prepaid tuition plan.

With a prepaid tuition plan, you purchase tuition credits at current rates to be used at some point in the future when your beneficiary attends one of the colleges or universities participating in the plan.

Most prepayment plans are sponsored by individual states and apply to the public institutions in the state, some state plans cover both public and private institutions in the state, and the Independent 529 plan includes more than 200 participating private institutions nationwide.

In the case of state plans, either you or your beneficiary may have to live the in the sponsoring state.

You owe no income tax on any appreciation in the value of the tuition credits if they are used to offset tuition, and you may be able to transfer the face value of the credits to a nonparticipating school if your child doesn't attend a participating one.

Some states and the Independent plan guarantee that your credits will cover the cost you prepay.

References in periodicals archive ?
As a qualified 529 prepaid tuition plan, College Illinois
A contribution, to a Section 529 prepaid tuition plan is used to purchase a contract that promises to pay for future college costs (usually tuition and mandatory fees) under the terms of the plan.
A 529 prepaid tuition plan offers a way to prepay future college tuition at today's contract rates.
The current FAFSA does not instruct students to include a 529 prepaid tuition plan as part of their parent's net worth, so financial aid administrators will have to ensure that 529 prepaid tuition plans no longer directly reduce need-based aid.
SM) 529 prepaid tuition plan as the best way to save on college tuition by paying for college costs at today's rates.
OFI) announced today the results of the first annual enrollment period of the Texas Tuition Promise Fund, a 529 prepaid tuition plan managed by OFI Private Investments, Inc.
Whether it is a traditional 529 savings plan (which allows investors to select market-based financial products similar to mutual funds), or a 529 prepaid tuition plan (which allows individuals to prepay future college tuition based on current tuition rates); contributions to 529 plans in states with state income tax deductions and credits enable investors to deduct some, if not all of their contributions from their state income taxes.
Through April 24, the state's 529 prepaid tuition plan is offering a rebate to parents and grandparents who roll over funds from another qualified college savings plan.
While the state-sponsored 529 prepaid tuition plans are aimed at public universities, Independent 529 Plan (www.
And there is a surprisingly low level of awareness of the newer sources of funding: only 34 percent of parents surveyed are aware of Section 529 prepaid tuition plans and only 29 percent are aware of Section 529 college savings plans.
The median household assets in state-sponsored 529 prepaid tuition plans and 529 college savings plans are each $5,000.