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Facts About West Virginia's 529 Plans

By    |   Wednesday, 20 May 2015 02:41 PM

As the cost of college continues to rise, parents look for tools to help provide their children with the advantage of a college education. The Qualified Tuition Program, or 529 plan, is a "tax-advantaged investment plan designed to encourage saving for future higher education expenses of a designated beneficiary," as described by CollegeSavings.org. By starting to invest when children are young, families can build up funds that later can be used to pay for post-secondary education.

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Distributions taken from the 529 plan are tax exempt at the federal level as long as they are applied to qualified educational expenses including tuition, books, fees, and supplies. West Virginia and many other states offer state level tax benefits as well. West Virginia allows for full state income tax deduction of contributions to its 529 plans. The state has a matching grant program that matches every dollar up to $500 per year for beneficiaries who are state residents and 12 years of age or younger. Additional savings can accumulate through partnership with the Upromise rewards program.

West Virginia's 529 plans are SMART529 WV Direct College Savings Plan, SMART529 Select, and The Hartford SMART529, all of which are managed by Hartford Life Insurance Company, with the first two options sold directly to consumers and the last sold through an advisor.

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The SMART529 WV Direct College Savings Plan is available only to residents of the state. There is no minimum initial contribution for this plan. There are no minimums for subsequent contributions except for automatic contributions, which have a minimum of $15 per month. This 529 plan offers a choice of age-based, static, and stable value investment options. http://www.savingforcollege.com/529_plan_details/index.php?page=plan_details&plan_id=75

With the SMART529 Select plan, lump-sum contributions require an initial minimum of $50 per fund for state residents with no minimum for subsequent contributions. There is a $15 minimum contribution for state residents with the automatic plan. Nonresidents who choose this 529 plan must make an initial contribution of $250 per fund and subsequently $25 per fund for lump-sum contributions. The nonresident automatic payment option carries a $25 per month per fund minimum. Investors choose between age-based and static investments.

The Hartford SMART529 plan follows the same minimum contribution requirements as the SMART529 Select plan for West Virginia residents and nonresidents. But this 529 plan offers twice as many investment options as SMART529 Select, as well as the expertise of an advisor.

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As the cost of college continues to rise, parents look for tools to help provide their children with the advantage of a college education.
529 plans
Wednesday, 20 May 2015 02:41 PM
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