Who can participate in SSGA Upromise 529?
The Plan is available to U.S. citizens or resident aliens with a valid Social Security number or Taxpayer Identification number. Certain other entities may be account owners, including custodial and trust accounts. An account owner must be of legal age and have a permanent U.S. address that is not a post office box. The beneficiary may be of any age, from newborn to adult. There are no restrictions on state of residence or income.
Who can be a beneficiary of an account?
The person on whose behalf you're opening the account (the beneficiary) must be a U.S. citizen or resident alien with a valid Social Security or Taxpayer Identification number. Each account may have only one beneficiary, but you may open as many accounts for as many different beneficiaries as you want. You do not have to be related to the beneficiary, and you may choose yourself as the beneficiary.
Can a trust establish a SSGA Upromise 529 account?
Yes. To open an account as a trust, you must include copies of the pages of the trust agreement containing the name of the trust, the date of the trust, and a listing of all trustees and their signatures.
Can I open an account for more than one beneficiary?
Yes. While there can be only one beneficiary named for each account, you can open separate accounts for different beneficiaries. Note: The same individual can be the beneficiary of multiple accounts. For example, a father, mother, grandparent, and uncle can each open a separate account for the same beneficiary and can also open separate accounts for other beneficiaries. The aggregate balance of all accounts in all 529 plans sponsored by the State of Nevada for the same beneficiary may not exceed the Maximum Contribution Limit, which currently is $370,000.
Can I open an account for an unborn child?
No. The beneficiary must have a Social Security number or Taxpayer Identification number, but you may name yourself as beneficiary and change the beneficiary later on.
Can I open a SSGA Upromise 529 account with the money from my child's UGMA/UTMA?
SSGA Upromise 529 permits a custodian for a minor under the Uniform Gifts to Minors Act or Uniform Transfers to Minors Act (UGMA/UTMA) to apply funds previously held in an UGMA/UTMA account to open an account in the Plan and to fund additional contributions to such an account, subject to the laws of the state under which the UGMA/UTMA account was established. Such a transfer of funds is generally a taxable event and you should consult with a tax advisor before transferring UGMA/UTMA assets to a 529 Plan. Additional contributions of money not previously gifted to the beneficiary under the UGMA/UTMA account may be made to a separate, non-custodial account, to allow the account owner to retain control of the separate account after the custodianship terminates.
Who is considered the owner of the UGMA/UTMA 529 account assets?
The Plan permits the custodian to act as the account owner. The beneficiary does not have control of the assets in the account until the custodian informs the Plan that the beneficiary has reached the age of majority.
Will I be able to change the beneficiary of this UGMA/UTMA 529 account?
A custodian account owner may not select a new beneficiary (directly or by means of a rollover), except as permitted under UGMA/UTMA guidelines. When the custodianship terminates, the beneficiary is legally entitled to take control of the account and may become the account owner. Additional contributions of money not previously gifted to the beneficiary under the UGMA/UTMA account should be made to a separate, noncustodial account, to allow the account owner to retain control of the separate account after the custodianship terminates.
Why do you need my personal information, including my Social Security number (or Taxpayer Identification number) and birth date?
The Plan is required by federal law to obtain certain personal information, which will be used to verify the account owner's identity. If you don't provide the requested information, we will not be able to open the account. If we are unable to verify the account owner's identity, the Plan reserves the right to close the account or take other steps we deem reasonable. Your beneficiary's Social Security number is also required for tax-reporting purposes.
Can I change the beneficiary?
Yes, the beneficiary may be changed at any time without tax consequences as long as the new beneficiary is a "Member of the Family" of the current designated beneficiary as defined under Section 529. For the complete listing of who is included in that group, see the Plan Description and Participation Agreement. Please note that rules regarding gifts and generation-skipping transfer tax may apply in the case of a change of beneficiary. You should consult with a tax advisor when considering a change of beneficiary. (See the Plan Description and Participation Agreement for more information.)
What if the beneficiary decides not to go to college?
If the beneficiary decides not to go to college, you have three options:
- Stay invested. You can leave the money in the account in case the beneficiary decides to attend school later. There is no age limit for using the money.
- Change the beneficiary. You can change the beneficiary on your account at any time provided that the new beneficiary is an eligible "Member of the Family" of the former beneficiary.
- Withdraw the money for other uses. The earnings portion of a withdrawal not used for a beneficiary's qualified higher education expenses is subject to federal and state income taxes and may also be subject to a 10% federal penalty tax. Exceptions to this penalty include a withdrawal made because the beneficiary:
- Dies (if paid to a beneficiary of the account beneficiary or the estate of the beneficiary)
- Becomes disabled
- Receives a scholarship, to the extent the withdrawal amount does not exceed the scholarship amount
- Attends a United States Military Academy, the United States Naval Academy, the United States Air Force Academy, the United States Coast Guard Academy, or the United States Merchant Marine Academy, to the extent that the amount of the withdrawal does not exceed the costs of education attributable to such attendance
Additionally, any accumulated earnings that are withdrawn from your account must also be reported on the recipient's income tax return for the year in which they are withdrawn. Contact your tax advisor to determine how to report a non-qualified withdrawal.
Can the account owner be changed?
Generally, yes; however, special rules apply for custodians of assets formerly held in an UGMA/UTMA account. UGMA/UTMA custodians are not permitted to change the account owner to anyone other than a successor custodian during the term of the custodial account under applicable UGMA/UTMA law. Because there may be additional tax considerations, please consult with a tax advisor before requesting a change of ownership.
You may also name a successor account owner to take over for you in the event of your death or legal incapacity. (See the Plan Description and Participation Agreement for more information.)
How much do I need to open an account?
You can get started with as little as $50 per month or $150 a quarter with an Automatic Investment Plan from your bank account. You can also start a payroll deduction plan for $15 or more per paycheck. Otherwise, the minimum investment amount is $15 for a lump sum contribution via check or a one-time Electronic Funds Transfer (EFT). The minimum amount for additional contributions made after opening an account is $50.
How much can I contribute to my account?
You can contribute until the aggregate account balances for your designated beneficiary under all college savings programs sponsored by the State of Nevada (including accounts established by other account owners) reach $370,000 (maximum contribution limit). At that point, your account can still accumulate earnings, but you will not be allowed to make additional contributions, unless the maximum balance limit is increased for the SSGA Upromise 529.
What expenses are involved in the SSgA Upromise 529?
The SSGA Upromise 529 has been designed to provide cost-efficient value to investors. Each portfolio has a different total asset-based fee. Please review the current Plan Description and Participation Agreement for the current annual rate. There is no enrollment fee; there is an annual account fee of $20. (The annual account fee is waived for Nevada resident account owners and beneficiaries.) Read the Plan Description and Participation Agreement for additional details.
How do I enroll?
You can open an account online or download the Enrollment Kit. Complete and mail the Enrollment Form.
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