529 Plans & FL Prepaid
What Is A 529 Plan?
A 529 Plan is a savings vehicle designed specifically for higher education expenses. The name “529” comes from Section 529 of the federal tax code, which authorizes states to offer the plans. There are two types of 529 Plans – Prepaid and Savings, and both Prepaid Plans and Savings Plans are authorized 529 college savings plans. Earnings in 529 Plans are tax-free when they are used for Qualified Higher Education Expenses. In general, qualified expenses include tuition, fees, room and board, and the cost of books, supplies and equipment required for the enrollment or attendance at an Eligible Educational Institution, including undergraduate, graduate, and vocational/technical schools.
What is the difference between a Prepaid Plan and a Savings Plan?
A Prepaid Plan is a prepackaged college savings plan covering specified college costs in the future. Prepaid Plans simplify saving for future college costs. You do not have to worry about how much to save, when to save or how to invest with a Prepaid Plan. Simply pick a plan, make your payments, and when your student is ready for college, the plan pays for the costs covered by the plan. The Prepaid Plans offered by the Florida Prepaid College Board are guaranteed by the State of Florida, so you can never lose what you’ve paid toward the plan.
A Savings Plan allows you to develop your own plan to save for college. You decide how much you want to save and when you want to save. You also get to choose how you want to invest your savings using the investment options offered by the plan. When it comes time for college, you use your savings to pay for actual college costs at that time. Savings Plans are not guaranteed, so the value of your investment is subject to market fluctuations.
For more information visit the Florida Prepaid Website.
How do I use my plan to pay for school?
If you have a 529 plan through a bank or financial institution, you will let the Financial Aid Office know of this plan and you will be set up as a cash pay student. Once you receive your finance plan you will provide the finance plan to the organization handling your 529 plan and they will issue the payments based on your payment schedule to the school.
FL Prepaid College Plan
If you have a Florida Prepaid College Plan you will need to:
- Complete a Florida Prepaid Transfer Form.
- Contact the Financial Aid Office to prompt us to discover the plan's value from Florida Prepaid.
- Once the plan's value is determined we will create and send your finance plan to you if you are not seeking other sources of Financial Assistance.
- On the first day of classes, you will need to come to the financial aid office to place an ink signature on the transfer form to authorize billing FL Prepaid.