Qualified Tuition Programs (529 Plans)

A QTP or Code Sec. 529 plan is a program under which an individual may prepay tuition credits or make cash contributions to an account on behalf of a beneficiary for payment of qualified higher education expenses.  The program must be established and maintained by a state, state agency, or by an eligible educational institution, i.e. private college or university.  Eligible schools generally include any accredited post-secondary educational institution, so long as contributions made to the program are held in a qualified trust, i.e. one which meets the requirements under Code Sec. 408(a)(2) and (5).  A QTP is exempt from all federal income taxation, except for the tax imposed on unrelated business income (A variety of nonprofit organizations with charitable or socially beneficial purposes may be granted tax exempt status but they are still subject to an unrelated business income tax.) (Code Sec. 529).

Contributions. Contributions to a QTP on behalf of any beneficiary cannot exceed the necessary amount of qualified higher education expenses (tuition, books, fees, supplies, equipment & a reasonable amount of room and board) for the beneficiary.  There are no AGI phase-out limits.  In addition, a taxpayer can contribute to both a QTP and a Coverdell account in the same year for the same beneficiary.

Indiana 529 plans



1.CollegeChoice 529 Direct Savings Plan2.CollegeChoice Advisor 529 Savings Plan3.CollegeChoice CD 529 Savings Plan