The Versatile 529 Plan

Features of the 529 plan make it a great component for both Individual Savings Plans and Employee Benefit Programs.

529 Plans can offer substantial Tax Advantages Along with Great Educational Benefits

Tax-Free Earnings Growth: There is no income tax due on any earnings while they are in your 529 Plan.

Tax-Free Distributions: Distributions put towards qualified education expenses made after December 31, 2001 are federal income tax free.

Any Institution in the United States: 529 assets can be used at any accredited institution of higher learning in the United States, as well as many foreign institutions.

No Income Limits: There are no income limits restricting participation.

Investment Choice: 529 Plans have various investment options you can choose from depending on your preferred investing style.

High Contribution Limit: Though the amount varies from plan to plan, you can typically contribute $225K or more to your 529 Plan.

Beneficiary Flexibility: You can change the beneficiary of your account to any other member of the original beneficiary's family, including a parent, at any time with no penalty.

Withdraw Funds at Any Time: Withdrawals can be made from your account at any time, but if the withdrawal is not used for a qualified education expense, the earnings will be taxed as ordinary income to the participant and a 10% penalty or additional tax will be assessed on any distributed investment gains.

Special Gift and Estate Tax Treatment: Contributions to your 529 are considered completed gifts for federal and estate tax purposes and can be excluded from your taxable estate.

A Great Benefit: A 529 Plan can be an integral part of an employee benefit program with payroll direct deposit.