Benefits & Tax Advantages
Make the Path2College 529 Plan a part of your savings strategy.
Many families hope to see their child or loved one graduate from college someday, but it takes more than hope to get there. The Path2College 529 Plan is a 529 plan that can help your family get there. Investing in education is a smart move and the tax advantages built into the Path2College 529 Plan can make it an important part of your overall college funding strategy:
- Tax Advantages
- Flexible Features
- Choice of Investment Portfolios
- Low Plan Fees
- Managed By a Leading Financial Services Provider
- Easy Access to Your Account
Contributions and Any Earnings Used to Pay for Qualified Higher Education Expenses are Federal and Georgia State Income Tax-free.
The earnings portion of any distributions used to pay for qualified higher education expenses will be free from federal and Georgia income tax.
You May Be Eligible for a Georgia Income Tax Deduction
All Georgia taxpayers may now contribute and deduct up to $2,000 each year on behalf of any beneficiary regardless of their annual income. Georgia taxpayers are not required to itemize deductions to make this adjustment to income. Please note that a transfer of funds from another state's 529 plan is not eligible for the Georgia income tax deduction. Georgia tax forms refer to the Path2College 529 Plan as "Georgia Higher Education Savings Plan" (GHESP); the Path2College 529 Plan is established by the GHESP.
Contributions made during the tax year, or before the following year's federal tax filing deadline are eligible for the deduction. State tax benefits offered in connection with the Path2College 529 Plan are available only to Georgia taxpayers. You should consult with a tax advisor regarding the application of Georgia state tax benefits to your particular circumstances. Recapture provisions apply. See the Disclosure Booklet for more details.
Federal Estate and Gift Tax Benefits
Contributions to the Path2College 529 Plan may reduce the taxable value of your estate. For example, contributions to the Plan, together with all other gifts from the account owner to the beneficiary, may qualify for an annual federal gift tax exclusion of $14,000 per donor ($28,000 for married contributors), per beneficiary. If an account owner's contribution to a Path2College 529 Plan account for a beneficiary in a single year exceeds $14,000 ($28,000 for married contributors), the account owner may elect to treat up to $70,000 of the contributions, or $140,000 for joint filers, as having been made over a period of up to five years for federal gift tax exclusion. Consult your tax advisor.
Anyone May Open an Account
Parents, grandparents, relatives and friends who are U.S. citizens or resident aliens and at least 18 years of age may open an account and contribute to the Path2College 529 Plan on behalf of a beneficiary*. Georgia state residency is not required. However, investors residing outside of Georgia should consider their own state's plan first as it may have tax advantages that are only available through that state's plan.
* The eligibility of an Account Owner for Medicaid assistance could be impacted by the Account Owner's ownership of a college savings account in a qualified tuition program. See the Disclosure Booklet for more information.
Funds Can be Used at Eligible Schools Nationwide
Whether your beneficiary decides to go to a private or public college or university, in-state or out-of-state, trade or graduate school, funds in the account may be used at any eligible higher educational institution in the nation and many abroad.
Funds Can be Used for a Variety of Qualified Expenses
Funds can be used for tuition, mandatory fees, books, supplies, and equipment required for enrollment or attendance; certain room and board costs, certain expenses for "special needs" students.
Choice of Investment Options
Choice of Investments
The Path2College 529 Plan offers a choice of seven Investment Options so you can choose an option or a combination of options that best suit your needs.
Low Minimum Contribution
It's easy to open an account with the Path2College 529 Plan. You have many ways to contribute and convenient ways to enroll. The minimum initial contribution is $25 through check, electronic funds transfer, automatic contribution plan from your bank account, or through a transfer of funds from another qualified 529 college savings plan. The minimum contribution is $15 (per Investment Option, per beneficiary) when contributions are made using payroll deduction.
No Income Limitations
There are no income limitations.
High Maximum Account Contribution Level of $235,000
Through contributions and earnings, a beneficiary account may reach a total balance of $235,000. While the account cannot receive further contributions when the balance has exceeded the maximum account contribution level, the account may continue to accrue earnings.
Ability to Transfer to Another Beneficiary
If your beneficiary does not attend an eligible educational institution, you may name another eligible beneficiary for your account. The new beneficiary must be a member of the previous beneficiary's family, as described in the Disclosure Booklet (PDF), in order to avoid having this change treated as a non-qualified withdrawal.
Low Plan Fees
With the Path2College 529 Plan, there are no sales charges, start-up or maintenance fees. An annual asset-based management fee will be paid to TIAA-CREF Tuition Financing, Inc. to cover the cost of investment management and administrative services. This fee is computed at an annual rate of 0.28% - 0.41% of the average daily net assets of your account, excluding assets held in the Guaranteed Option. Please note that the State of Georgia reserves the right to change the current fee and impose new or additional fees, expenses, charges or penalties in the future. For details on the management fee, please see fees and expenses.
Managed By A Leading Financial Services Provider
The State of Georgia selected TIAA-CREF Tuition Financing, Inc. to serve as plan manager for the Path2College 529 Plan. TIAA-CREF Tuition Financing, Inc. is an affiliate of TIAA-CREF, a financial services organization with more than 90 years of investment experience. Visit TIAA-CREF.
Easy Access to Your Account
You'll have online access to your account information 24 hours a day, or you can call and speak to one of our college savings specialists Monday through Friday, 8:00 am -8:00 pm ET. You'll receive quarterly and annual statements that show account activity. A separate confirmation statement will also be mailed following each transaction in your account.
You can also perform the following account transactions online: request a withdrawal from your account; rebalance funds among investment options, request e-Delivery versus paper delivery, establish or change automatic contributions and view pending account contributions.[an error occurred while processing this directive]
PDF files require the free Adobe Acrobat Reader. Get it here.