SPRINGFIELD, Ill., Jan. 6 /PRNewswire-HISPANIC PR WIRE/ — An exciting change recently issued by the Internal Revenue Service (IRS) regarding section 529 plans makes it easier than ever to roll over existing accounts into a College Illinois!(SM) plan. Specifically, according to section 529(b)(4) of IRS Notice 2009-1, owners of 529 accounts are now permitted two investment fund changes per year, as opposed to only one. The change was made in response to a call for more flexibility in 529 plans. Industry experts want to ensure that 529 accounts remain an attractive option despite the floundering financial markets. For example, Illinoisans who already made changes to their 529 savings plan during the past year now have an extra opportunity to remove funds from stock market volatility by rolling over into a College Illinois! prepaid tuition plan.
“By allowing owners of 529 plans the ability to change funds or allocations more than once per year, the entire 529 category becomes more attractive to those looking to secure their children’s future college tuition,” said Andrew Davis, executive director of the Illinois Student Assistance Commission. “Rolling your funds into a College Illinois! plan affords your investment much needed security and provides you peace of mind, since the struggling stock market does not affect our individual plans.”
College Illinois! works like an insurance policy, protecting a child’s future college tuition from year over year inflation. When parents or grandparents pick a price and lock it in, every payment goes directly into future college tuition. Enrolling or rolling funds over into the program provides parents and grandparents with peace of mind by literally stopping tuition inflation in its tracks. Purchasers can upgrade their plan at any time to cover additional years of tuition and fees.
“Although the struggling economy continues to make navigating the financial field a difficult task, this IRS announcement demonstrates that people value saving for their children’s future college education,” said Davis.
Other excellent reasons to begin or roll over into a College Illinois! 529 prepaid tuition program:
* Upon purchasing a contract, not only can Illinois taxpayers deduct up to $10,000 per individual or $20,000 for married couples filing jointly, but all plan earnings are exempt from state and federal tax exemptions as well.*
* College Illinois! applications can be completed online in less than 10 minutes at collegeillinois.com. Once an application is submitted, a payment can be made before the December 31 tax deadline.
* SmartChoice pricing provides three distinct price levels with different payment options. The plans are completely flexible and let the purchaser choose a pricing option that best matches financial needs and realities. Combination plans including four semesters at a community college and four semesters at a university level are also available. Various payment options include monthly and annual installments and multiple down payment levels.
* In addition, program beneficiaries can choose to attend college anywhere because benefits can be used outside of the state at public and private institutions nationwide.
College Illinois! is open for enrollment through April 30, 2009. For more information about College Illinois!, or to enroll in the program, visit http://www.collegeillinois.com or call (877) 877-3724.
About College Illinois! and the Illinois Student Assistance Commission:
Administered by the Illinois Student Assistance Commission (ISAC), College Illinois! is a secure college funding option. Similar to an insurance policy, College Illinois! is a contract between the purchaser and the state of Illinois that ensures tuition and fee benefits for college.
Since the program’s inception in 1998, more than 62,500 prepaid tuition contracts with a value of more than $1.4 billion have been purchased. The program’s Trust Fund is managed by professional money managers and is subject to oversight by the program’s Investment Advisory Panel and the Illinois Student Assistance Commission.
The Illinois Student Assistance Commission provides students of all ages and backgrounds with the resources and support to obtain financial aid for higher education. A state agency, ISAC has paved the path to post-secondary education with innovative programs for more than 50 years. Last year alone, ISAC continued its mission to make college affordable for Illinois students by issuing 185,000 grants and scholarships totaling more than $448 million. Students and familes have free access to a wealth of financial aid and college planning information at ISAC’s family of websites at: http://www.knowhow2GOIllinois.org.
* Neither ISAC nor College Illinois! can provide legal or tax advice. Please consult a professional tax advisor concerning federal and state tax implications or purchasing any contract.
SOURCE College Illinois!