529 – College Savings Plan

CollegeChoice Advisor is a 529 college savings plan with a difference. This flexible program gives you the freedom to choose your beneficiary, investments, and contribution. It also offers a variety of additional features and benefits, from sophisticated online account access to investment management from respected asset managers.

Availability

  • Anyone — including friends, grandparents, and other family members — may contribute to the Plan; all that’s needed is a valid Social Security number or Taxpayer Identification number.
  • The beneficiary can be any age (as long as he/she has a valid Social Security number).
  • There is no income limit for participation.
  • As the account owner, you maintain control of the assets at all times. You can even change beneficiaries.*

Tax advantages

  • Your Plan earnings grow free from federal and state income taxes.
  • Indiana taxpayers are eligible for a state income tax credit of 20% of contributions to a CollegeChoice Advisor account, up to $1,000 credit per year.
  • Distributions for qualified higher-education expenses are free from federal and Indiana state income tax.
  • You may contribute as much as $14,000 per beneficiary each year ($28,000 for married couples filing jointly) without incurring gift-tax consequences. In fact, you can choose a special election that allows you to treat a $70,000 contribution ($140,000 married filing jointly) as if it was made over a five-year period.

No Impact on Financial Aid

If you and your beneficiary are Indiana residents, there is no impact on state financial aid.

Using the money

  • You can apply CollegeChoice Advisor assets to any eligible accredited college, university, or institution of higher education, not just those in Indiana.
  • Distributions may be applied to any qualified higher education expense including tuition, fees, certain room and board expenses, and even books and supplies for undergraduate and/or graduate education.

* For beneficiary changes to occur without federal or state income taxes, the new beneficiary must be a family member of the original beneficiary. ** This credit may be subject to recapture from the account owner (not the contributor) in certain circumstances, such as a rollover to another state’s qualified tuition program or a non-qualified withdrawal. Please note that, effective January 1, 2010, the Indiana state income tax credit will no longer apply to rollovers from another state’s qualified tuition program or to transfers from the Upromise service into a CollegeChoice Advisor account. All other contributions will continue to be eligible for the tax credit to the extent previously allowable. *** Earnings on non-qualified withdrawals are subject to federal income tax and may be subject to a 10% federal penalty tax, as well as state and local income taxes. The availability of tax or other benefits may be contingent on meeting other requirements. + In the event the donor does not survive the five-year period, a pro-rated amount will revert to the donor’s taxable estate. ++ Eligible institutions include all post-secondary institutions that participate in the Federal Financial Aid Program.

Source: https://www.collegechoiceadvisor529.com

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