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Schannep Investment Advisors, Inc.
Your future is why we're here.
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A look at different
college savings plans available |
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Contribution |
Income |
Potential |
Federal Financial |
Flexibility of |
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Tax Breaks |
Limit |
Restrictions |
Sunset Changes |
Aid Impact |
Fund's Use |
| 529 College |
Qualified |
Up to total of about |
None |
Earnings |
Considering parent's |
Tuition, fees, room, |
| Savings Plan |
Distributions tax- |
$300,000 for some |
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withdrawals will be |
assets, assessed up |
board, and graduate |
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free. (Some states |
plans; may pay gift |
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taxed at child's rate |
to 5.6%. |
school. |
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may also offer tax |
taxes if more than |
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after 2010. |
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breaks). |
$11,000 a year. |
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Can donate up to |
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$55,000 at one time |
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| 529 State |
Qualified |
Maximum varies by |
None |
Earnings |
Considered student |
For most plans, |
| Prepaid Plan |
distributions tax- |
state, but plans |
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withdrawals will be |
resources: Reduces |
tuition, fees, room |
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free. (Some states |
cover, in general, up |
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taxed at child's rate |
aid eligibility dollar |
and board. |
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may also offer tax |
to five years of |
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after 2010. |
for dollar. |
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breaks). |
college costs. |
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| Independent |
Qualified |
Up to five years' |
None |
withdrawals will be |
Considered |
Tuition and |
| 529 Plan |
distributions tax- |
tuition at the group's |
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taxed at child's rate |
student's assets, |
mandatory fees |
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free. |
most expensive |
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after 2010. |
assessed at 35%. |
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college (currently |
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$137,000). |
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| Coverdell |
Qualified |
Up to $2,000 a |
For single filers, |
Contribution limits |
Considered parent's |
Post-secondary |
| Education |
distributions tax- |
year. |
$95,000 - |
would revert to |
assets, assessed up |
costs; K-12 costs, |
| Savings |
free. |
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$110,000; for joint |
$500 after 2010. |
to 5.6%. |
some computers |
| Account |
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filers, $190,000- |
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$220,000 |
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| Custodial |
For kids over 14, |
No total maximum, |
None |
Favorable 5% tax |
Considered parent's |
Anything that |
| Accounts |
earnings taxed at |
but may pay gift |
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rate set to expire in |
assets, assessed up |
benefits the minor. |
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child's rate; under |
taxes if more than |
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2009 |
to 5.6%. |
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14, earnings less |
$11,000 a year. |
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than $750 are tax- |
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free. |
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| Savings |
Interest earned is |
Annual limit of |
For 2003, for |
None |
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Tuition and |
| Bonds |
tax-free if used for |
$30,000 per owner. |
singles, $58,500- |
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mandatory fees. |
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qualified higher- |
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$73,500; for joint |
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education |
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filers, $87,750- |
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purposes. |
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$117,750 |
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| Taxable |
Up to 15% tax on |
Unlimited |
None |
Favorable 15% rate |
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Unlimited |
| Accounts |
capital gains and |
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also set to expire in |
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dividend income. |
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2009 |
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Source: The Wall Street Journal, September
24, 2003 |
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( Return to Investment Primer
Index )
This report is
prepared for general circulation and is for informational purposes only. It
is not intended as an offer or solicitation for the purchase or sale of any
financial instrument or service. Market prices and other data may be
obtained from outside sources and is not warranted as to completeness or
accuracy. Any comments, statements and/or recommendations made herein do not
necessarily reflect those of First Allied Securities, Inc., its subsidiaries
or affiliates, and are subject to change without notice. |
Securities offered through
First Allied Securities, Inc. A register broker/dealer. Member FINRA/SIPC.
Schannep Investment Advisors is a registered investment
adviser in the state of Arizona. First Allied Securities, Inc. does not endorse or
support this web site, nor are they affiliated with Schannep Investment Advisors,
Inc.
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