Planning to let your child study in Oregon for college? It is
important to prepare for his/her future. And you can do this by saving for a
college education through a college plan. Fortunately, Oregon 529 College
Savings Network exists to put up your dreams within reach. The Network offers
annual state tax deduction, tax-free growth, and investment choices.
The Network has two kinds of college savings plan, each of
this plan has a set of unique investment options and programs which provide
federal tax advantages. The first plan is called “Oregon College Savings Plan”
which can be purchased directly without having to use a financial advisor.
The Oregon College Savings Plan is apparently administered
by the State of Oregon. With this plan, contributions or earnings used to pay
for qualified higher education expenses will be made free from any state income
tax in Oregon and the federal.
But contributions to the Plan are only deductible up to an
annual limit. A deduction limit is indexed every year for inflation. For the
past year, the allowable annual tax deduction is $4,240. This comprises all
contributions made by the taxpayer to all Network accounts which include
accounts in the Plan.
But the plan will help
reduce the taxable value of your estate. Contributions and gifts from the
account owner to the beneficiary, will most probably qualify for an annual
federal gift tax exclusion amounting to $13,000 per donor, per beneficiary.
The plan offers more
flexible features. Anyone can apply for the plan. If you’re the parent,
grandparent, relative, or even just a friend who is a US citizen or a resident
alien, you may open an account as long as you are at least 18 years old. You
need not be residing in Oregon State to contribute for the savings plan on
behalf of a beneficiary. But then, you might as well consider your own state’s
plan first to avail of the tax advantages they offer.
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