Each year Morningstar researches and ranks college 529 plans across the nation. For people who live in Iowa, it is good to know that while the College Savings Iowa 529 Plan did not achieve the highest gold level ranking, it did receive a high bronze rating.
Iowa’s 529 plan is an attractive college savings option, especially for in-state residents. Annual contributions up to $3,163 per taxpayer per beneficiary to the College Savings Iowa 529 Plan are deductible on your state of Iowa income tax return. Like all other 529 plans, contributions are not deductible for federal income tax purposes. But, as long as you draw the funds later for qualifying college expenses, earnings grow tax-free.
The Iowa plan has also has a low annual fee of 0.26% per year and allows the participant of the plan to remain in control of the savings if your child decides against going to college. The Iowa 529 plan offers fourteen different investment options depending on your risk tolerance and how much control you wish to have over the account. All of these features add up to a great college savings plan, especially for Iowa residents.
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