Which state has the best 529 college savings plan?
Which state has the best 529 college savings plan?
Best Performance
- Ohio’s 529 Plan, CollegeAdvantage.
- SMART529 WV Direct College Savings Plan.
- New York’s 529 College Savings Program — Direct Plan.
- The Vanguard 529 College Savings Plan.
- CollegeChoice 529 Direct Savings Plan.
Which state has the best performing 529 plan?
Top 10 performing 529 college savings plans
| Rank | State | Performance Score |
|---|---|---|
| 1 | West Virginia | 30.54 |
| 2 | Louisiana | 31.47 |
| 3 | Indiana | 31.62 |
| 4 | New York | 33.42 |
When a 529 plan is not the best college savings option?
Funds from a 529 plan that are not used for qualifying college expenses are subject to a 10% penalty and any gains are taxed at the parent’s marginal tax rate, which can be as high as 37% for tax year 2020 . If the beneficiary of the 529 plan receives a scholarship, the 10% penalty is waived.
How much should you invest in 529 plan?
With a 529 plan, solid monthly contribution amounts for a child born in 2017 would be about $165 for a public in-state school, $260 for public out-of-state, or $325 for a private university.
Can grandparents write off 529 contributions?
Yes, 529 plans accept third-party contributions, so a grandparent may contribute to a grandchild’s 529 plan account, regardless of who owns the account. This 5-year gift-tax averaging allows you to front-load contributions into a 529 plan without exceeding the $15,000 annual gift exclusion.
What states allow tax deductions for 529 contributions?
However, there are seven tax parity states that offer a state income tax benefit for contributions to any 529 plan:
- Arizona.
- Arkansas.
- Kansas.
- Minnesota.
- Missouri.
- Montana.
- Pennsylvania.
Should a 529 be in the grandparents name?
A: 529 accounts owned by grandparents (or other non-parent) are not reportable as an asset on the FAFSA financial aid application. Grandparent owned 529 accounts are not counted in determining financial aid eligibility; all the more reasons for grandparents to make gifts to their grandchild’s 529 plan.
What if child does not go to college 529 plan?
Parents investing in a 529 college savings plan may wonder: “What if my child doesn’t go to college? Do I lose my invested money?” The simple answer is: No, you won’t lose your money. The funds in a 529 plan can be used in a number of other ways if your beneficiary decides not to pursue higher education.
