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§529 College Savings Plans

Named after the section of federal tax code that governs them, §529 College Savings Plans can provide a tax efficient means for meeting the expenses associated with higher education. Since §529 plans may be operated by individual states and educational institutions, the features and benefits can differ from plan to plan. Your Legend Advisor can guide you in selecting an appropriate option.

§529 plans offer significant benefits for investors seeking to fund a college education:
  • There are no income limits to establish a §529 account or contribute to a §529 plan.
  • §529 plan assets can be used to cover educational costs at almost any accredited post-secondary school in the United States, for a beneficiary such as a child or grandchild.
  • Anyone can open an account at any time, for the benefit of anyone they wish—a child, grandchild, relative, friend—even themselves!
  • Anyone can contribute: parents; grandparents; other relatives; family friends.
  • Contribution minimums are generally low while the maximum amount allowed over the life of the account is quite sizeable—more than $200,000 per student under most plans.1
  • Distributions, including earnings, are free from federal income taxes, and in many cases, state tax, as long as withdrawals are used for eligible higher education expenses such as tuition and room and board.2
  • You can change beneficiaries within the same family as often as you like3; you can even use the plan to pay for your own education3 or withdraw the assets.2
  • Control of the asset remains with the contributor, even after the beneficiary reaches legal age.4
  • Investment choices may include a selection of professionally managed portfolios offered by a variety of prominent mutual fund companies.
  • Special gift and estate tax treatment.5

See Legend's Comparison of Investments for College Savings for further details.

It's never too early to start a college savings program.
Contact your Legend Advisor to begin taking advantage of this tax-advantaged savings vehicle. Your Advisor can assist you with account setup and investment selection, and help ensure your portfolio remains on track to achieve your goals.

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1Rules may vary from state to state

2Federal income tax on the earnings and a 10% penalty may apply to distributions not used for qualified higher education expenses.

3The new beneficiary must be a member of the original beneficiary’s family. There may be federal gift or generation skipping transfer tax consequences if the new beneficiary is a member of a younger generation than the original beneficiary.

4Assumes the proceeds to fund the account were not derived from an UGMA or UTMA account.

5Legend Equities Corporation does not render tax or legal advice. Consult your tax advisor or attorney for tax and legal advice specific to your situation.

Section §529 Plans offered: Are Not FDIC Insured; May Lose Value; Are Not Bank Guaranteed. For more information, including a description of fees, expenses and risk, contact Legend Equities Corporation or your financial representative before you invest or send money. Favorable state tax treatment may be limited to investments made in a §529 college savings plan offered by the customer’s home state. Customers should consult their tax advisor before investing.

Before investing in a §529 plan, consider its investment objectives, risks, charges and expenses carefully. The official statement, which contains this and other information about the §529 plan, can be obtained by contacting Legend Equities Corporation. Please read the official statement carefully before you invest or send money.