529 Account

Today a person is able to avail of four different savings plans to help make college education more affordable in the state of Virginia. All the four Virginia 529 plans available will place those who are paying out for a person's education (parents, grandparents or other relatives) in to a much better financial position.

However before enrolling on to anyone of the these plans it is important that the person carries out a comparison of 529 plans not just in the State of Virginia but other states in the USA as well. Remember you do not have to restrict yourself solely to those 529 education plans, which are available in the state where you live, but you can choose to use ones in others as well.

But as well as parents or grandparents saving monies into a plan for their child's education if they wish they can open one so that they are able to continue their own education as well. Currently in the state of Virginia they have three programs available for those adults who want to earn further credentials and these are VEST, College America and College Wealth.

Yes you could probably find a number of Virginia college tuition assistance programs available but they will not provide you with some of the same benefits as a 529 plan does. Remember all earnings made on a 529 plan grow tax free and any funds that are withdrawn to pay for college or higher education expenses do not require the person to pay Federal income tax on them.

Also if you get grant money for college tuition would you be provided with the same benefit of there being a state tax deduction of $2,000 each year against what you are currently earning? With a Virginia 529 plan you do get the chance to avail of this deduction and there is unlimited carry forward until such time as all contributions have actually been deducted.

For grandparents who chose to contribute towards these plans they are entitled to contribute $12,000 (one person) or $24,000 (for a couple) to the plan. During this tie they will then not incur nay federal gift tax payments to be made on the contributions. Plus those over the age of 70 if they so wish are able to make one single payment from their taxable income they earn in the state of Virginia either now or in the future for the total amount.

As with all 529 savings plan the holder of it has sole control over it and so only they can make changes or withdraw funds from the account. Plus it is only the account owner (the person who has set it up) is actually able to avail of state tax deduction on the Virginia 529 plan that has been arranged.

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