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College Savings Plans Double Assets

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NU Online News Service, May 14, 2004, 3:33 p.m. EDT – The stock market rebound and natural market growth have pumped up assets at 529 college savings plans.[@@]

The plans ended the first quarter with about $40 billion in assets, up from $21.3 billion a year earlier, according to the College Savings Foundation, Washington.

Net new plan contributions amounted to $4.1 billion, the foundation estimates.

Section 529 of the Internal Revenue Code gives each state the authority to set up its own 529 college savings plan programs. The code exempts taxpayers from paying federal income taxes on either contributions to or normal distributions from the plans.