529 Plans

529 Plan accounts are flexible accounts specifically designed for college savings. Qualified distributions from a 529 Plan account are federal income tax-free when used to pay for certain educational expenses. The plans were named after Section 529 of the IRS code that created them.

Summit Financial Group professionals can help you choose and manage state-sponsored 529 Plans, which are designed for college savings.

Each 529 Plan is state-sponsored and managed by a financial services company. Residents of any state can invest in any plan.

529 Plans are state sponsored investment programs. There is no guarantee by the issuing municipality or any government agency. Under a "sunset provision", certain federal tax benefits associated with 529 Plans are scheduled to expire on December 31, 2010, in the absence of re-enactment. You should consider the potential benefits (if any) that your own state's plan (if available) offers to residents prior to considering another state's plan. Withdrawals for other than qualified higher education expenses will be subject to federal income taxes and a potential 10% penalty on earnings. As with all tax-related decisions, consult with your tax advisor. Please note that assets in a 529 Plan could impact the beneficiary's ability to qualify for grants and student loans. Annual asset charges for a 529 plan may be higher than corresponding share classes. Investment return and principal value will fluctuate with changes in market conditions. For more complete information on a specific 529 Plan, including charges, expenses, and qualifying distributions, please read the offering statement carefully before investing or sending money.