Oklahoma 529 College Savings Plan (OCSP)

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Treasurer reminds Oklahomans there’s still time to maximize 2016 tax advantages

Mar 22, 2017

OKLAHOMA CITY — State Treasurer Ken Miller is reminding Oklahomans that there’s still time to make contributions to an Oklahoma 529 College Savings Plan for potential tax advantages on their 2016 state returns.

Miller, board chair of the Oklahoma 529 College Savings Plan (OCSP), noted that the OCSP is the only 529 college savings plan that offers an Oklahoma income tax deduction. Contributions to OCSP account that are made up to this year’s April 18 tax deadline are eligible for deductions on 2016 tax returns.

“It’s always a good time to be thinking about funding your child’s or grandchild’s college education,” Miller said, “but this time of year offers an extra incentive for those looking for a prior year tax benefit. And, if you haven’t already started an OCSP 529 account, now is an excellent time to do so.”

In addition to the possibility of a state income tax deduction on plan contributions, any earnings to an OCSP account are federal and Oklahoma income tax-deferred, and distributions are federal and Oklahoma income tax-free when qualified withdrawals are made to fund an array of student expenses at most institutions of higher learning.

Funds may be used at most any private or public university, college or career technology center nationwide, and can be applied to tuition as well as other qualified expenses, including fees, books, supplies and certain room and board costs. Computers and related technology equipment also count as qualifying expenses for 529 plan account holders.

“Too many students are leaving school with high amounts of debt,” Miller said. “That can impact them and their families for years to come as they look to get married, buy a home or have children of their own. It’s never too early for families to start planning for how they will pay for college.”

Student loan debt statistics indeed illustrate an increasingly troublesome trend in America.

According to a February report from the Federal Reserve Bank of New York, Americans hold more student loan debt than credit card debt – $1.31 trillion to $779 billion.1 To put that in perspective, students in the class of 2016 graduated with an average of $37,172 in student loan debt, according to Forbes.2

“Laying out a plan to pay for college is key to limiting the amount of money that college students must borrow, or eliminating the need to borrow altogether,” Miller said. “With the right planning, college graduates can get started on their careers and their lives on firm financial footing.”

For more information about the Oklahoma 529 College Savings Plan or to open an account, go to www.ok4saving.org or call (877) 654-7284.

About the OCSP

Oklahoma taxpayers may deduct from their Oklahoma adjusted gross income up to $10,000 in contributions to the Oklahoma 529 College Savings Plan for individual taxpayers and up to $20,000 for taxpayers filing a joint return with a five-year carryforward. Read the Disclosure Booklet carefully.

Any earnings in an OCSP account are federal and Oklahoma income tax-deferred, and distributions are also federal and Oklahoma income tax-free when qualified withdrawals are made to fund an array of student expenses at most institutions of higher learning. Funds may be used at virtually any private or public university, college or career technology center nationwide.

Introduced in April 2000, the Oklahoma 529 College Savings Plan had more than $763 million in total assets and more than 62,000 accounts, as of March 3, 2017.

Consider the investment objectives, risks, charges and expenses before investing in the Oklahoma College Savings Plan. Please visit www.ok4saving.org or call toll-free 1-877-654-7284 for a Plan Disclosure Booklet containing this and more information. Read it carefully.

Before investing in a 529 plan, consider whether the state where you or your Beneficiary resides has a 529 plan that offers favorable state tax benefits that are available if you invest in that state’s 529 plan.

Taxpayers should seek advice based on their own particular circumstances from an independent tax advisor. Non-qualified withdrawals may be subject to federal and state taxes and the additional federal 10% tax.

Account value in the Investment Options is not guaranteed and will fluctuate based upon a number of factors, including general market conditions.

TIAA-CREF Tuition Financing, Inc., Program Manager. TIAA-CREF Individual & Institutional Services, LLC, member FINRA, distributor and underwriter for the Oklahoma College Savings Plan.

1https://www.newyorkfed.org/newsevents/news/research/2017/rp170216

2https://www.forbes.com/sites/zackfriedman/2017/02/21/student-loan-debt-statistics-2017/#2e4fdeb45dab

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