DATE: May 23, 2006
CONTACT: Gus Wales
PHONE: (225) 922-2029
FAX: (225) 922-0790
START Saving Program Deposits Pass $100 Million Mark
The START Saving Program, Louisiana’s “529” college savings plan, recently passed $100 million in deposits, hitting the milestone at the end of the 1st quarter of 2006.
“This milestone clearly demonstrates that START’s value-added benefits have proved a winning combination for Louisiana families who choose to invest in their children’s education,” START Director Carol Fulco said.
This innovative college savings program was created by the Louisiana Legislature in 1995 and was first implemented in 1997, and qualifies under Section 529 of the Internal Revenue Code as a qualified college savings plan. As such, earnings grow tax deferred and, when used to pay a beneficiary’s qualified higher education expenses, are not taxed by the state or federal government.
Designed to help make education affordable for all Louisiana students, START allows account owners to save in a conservative, interest-bearing account managed by the Louisiana Treasurer or in equity investment options managed by the Vanguard Group, Inc.
START account owners who are Louisiana residents may deduct their deposits from income reported on Louisiana tax returns, up to $2,400 per account per year, or $4,800 per beneficiary for account owners who file jointly.
Most accounts are eligible to receive Earnings Enhancements, a contribution from the state that matches a percentage of annual deposits made by the account owner. The state match ranges from 2 to 14 percent, as determined by the account owner’s prior year federal adjusted gross income.
Savings may be used to pay qualified expenses at any accredited college or university, in or out of state, at any campus of the Louisiana Technical College, and at state-approved proprietary schools that are eligible to participate in federal financial aid programs.
Currently, total assets
of the program exceed $106 million and represent 20,398 active accounts. For
more information, please visit the START Web site at www.startsaving.la.gov.