529 Education Investment Plans

Congress passed a jobs bill in 1996 with a provision creating the Section 529 college savings account. The funding limits and qualified uses for 529 accounts have been expanded since creation.  529 accounts offer tax-free growth of investments and tax-free withdrawals for qualified educational purposes, in addition to estate planning benefits to the donor.


Prior to investing in a 529 Plan investors should consider whether the investor's or designated beneficiary's home state offers any state tax or other state benefits such as financial aid, scholarship funds, and protection from creditors that are only available for investments in such state's qualified tuition program. Withdrawals used for qualified expenses are federally tax free. Tax treatment at the state level may vary. Please consult with your tax advisor before investing.