5 Reasons Why You Need a 529 Account
A 529 plan is an investment account where the funds are designed to pay for your students’ education. As stated in Part 1 of this series, 529s can cover qualified education expenses. Here are 5 reasons you should consider opening a 529 account for your student. 1. Tax Benefits >Earnings within the account grow federally tax free and there is no tax penalty if the funds are used to pay for college expenses. >Earnings in the account do not have to be reported on your tax return. >The state of Iowa incentivizes owners of 529plans by granting them a state tax deduction when they invest. 2. Flexibility >Your 529 account can pay for more than just tuition. Other qualified expenses include room and board, books and supplies, fees, computers and software, and requirements for enrollment. The plans can now also fund graduate school, tech school, and up to $10,000 worth of student loans. >529s are [...]