Features
Lock in Current Tuition Rates
Investment Risk
Asset Use
Fees
Financial Aid Impact
Federal Tax Exemption
State Tax Exemption
State Tax Deduction
Account Owner Income Limit
Contribution Limit
Account Control
Beneficiary Age Limit
Designated Beneficiary
Gift Tax Treatment
Estate Tax Treatment
Features
Private College 529
Lock in Current Tuition Rates
Yes
Investment Risk
None. Prepaid tuition guaranteed by participating schools
Asset Use
Undergraduate tuition at participating schools. Any qualified expense at non-participating schools
Fees
None
Financial Aid Impact
Account owner assets
Federal Tax Exemption
Qualified withdrawals
State Tax Exemption
Varies by state
State Tax Deduction
Varies by state
Account Owner Income Limit
None
Contribution Limit
5x tuition for 5 years at most expensive participating school (now $285,030)
Account Control
Account owner
Beneficiary Age Limit
None
Designated Beneficiary
Account owner controls
Gift Tax Treatment
Up to $15,000 ($30,000 for joint filers) per child, or combined five-year gift up to $75,000 ($150,000)
Estate Tax Treatment
Excluded from donor estate (proportional inclusion if donor dies during the five-year election period)
Features
529 College Savings Program
Lock in Current Tuition Rates
No
Investment Risk
Varies
Asset Use
Range of higher education expenses, i.e. tuition, fees, books, computers, room and board
Fees
Varies by state and investment choices. May incur sales charges if bought through broker/advisor
Financial Aid Impact
Account owner assets
Federal Tax Exemption
Qualified withdrawals
State Tax Exemption
Varies by state
State Tax Deduction
Varies by state
Account Owner Income Limit
None
Contribution Limit
Varies by state
Account Control
Account owner
Beneficiary Age Limit
None
Designated Beneficiary
Account owner controls
Gift Tax Treatment
Up to $15,000 ($30,000 for joint filers) per child, or combined five-year gift up to $75,000 ($150,000)
Estate Tax Treatment
Excluded from donor estate (proportional inclusion if donor dies during the five-year election period)
Features
Coverdell Education Savings Account
Lock in Current Tuition Rates
No
Investment Risk
Varies
Asset Use
Range of education expenses, i.e. tuition, fees, books, supplies, room and board, including K-12
Fees
Varies. May incur sales charges if bought through broker/advisor
Financial Aid Impact
Account owner assets
Federal Tax Exemption
Qualified withdrawals
State Tax Exemption
None
State Tax Deduction
None
Account Owner Income Limit
Phases out for incomes between $95,000 - $110,000 (single), $190,000 - $220,000 ( joint)
Contribution Limit
$2,000 per year
Account Control
Account owner
Beneficiary Age Limit
Can contribute until child reaches 18. Must spend assets by child's 30th birthday
Designated Beneficiary
Account owner controls
Gift Tax Treatment
Up to $2,000 per year per child without gift tax
Estate Tax Treatment
Excluded from donor estate
Features
Ugma/Utma Account
Lock in Current Tuition Rates
No
Investment Risk
Varies
Asset Use
Not restricted to education expenses
Fees
Varies. May incur sales charges if bought through broker/advisor
Financial Aid Impact
Student Assets
Federal Tax Exemption
None
State Tax Exemption
None
State Tax Deduction
None
Account Owner Income Limit
None
Contribution Limit
None
Account Control
Assets irrevocable
Beneficiary Age Limit
18 or 21, depending on state law
Designated Beneficiary
May not be changed or transferred
Gift Tax Treatment
Up to $15,000 per year per child without gift tax
Estate Tax Treatment
Excluded from donor estate
