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Pennsylvania 529 College Savings Program
The Pennsylvania 529 College Savings Program website is for information purposes only, and does not constitute an offer to sell or solicitation of an offer to buy any security referenced on the site. Such offers or solicitation can be made only through the program Disclosure Statements.
The Pennsylvania 529 College Savings Program offers two plans sponsored by the Commonwealth of Pennsylvania and recognized under Internal Revenue Code Section 529.
They offer these key benefits:
Federal and Pennsylvania income tax advantages
- Pennsylvania taxpayers can deduct contributions to a 529 account from their Pennsylvania taxable income up to $13,000 per beneficiary per year. For married couples, contributions up to $26,000 per Beneficiary are deductible, provided each spouse has taxable income of $13,000.
- Earnings are not subject to yearly taxation for either federal or Pennsylvania income taxes while they remain in the account.*
- When used for qualified educational expenses, the growth in your account is not subject to federal or Pennsylvania income taxes.*
Special gift, estate, and inheritance tax benefits
- You can contribute up to $65,000 in a single year ($130,000 for a married couple filing jointly) for each beneficiary without incurring federal gift tax, and treat the contribution as if it were made over a five-year period for gift tax purposes.** Plus, the money in your account will not be included in your estate for federal estate tax purposes.
- Even though the money is not in your estate, you, as the Account Owner, maintain control over how the assets are used.*
- Funds in the account are exempt from Pennsylvania inheritance tax - Depending on the relationship between the deceased Account Owner and the heirs, this can be a savings of up to 15% of the entire value of the account.
Consult your tax advisor for more detailed information.
Diversity of investment options
You may elect to save so that your money is guaranteed to keep up with the rate of college tuition inflation through the Pennsylvania 529 Guaranteed Savings Plan (GSP).
Or, you may choose from a wide array of portfolios professionally managed by Vanguard through the Pennsylvania 529 Investment Plan
Flexible contributions
You can contribute whenever you want, in whatever amount that you want, starting with as little as $25 at a time. You may accumulate up to $368,600 for each Beneficiary (combining all the Pennsylvania College Savings Program accounts held for the same Beneficiary).
No age or income restrictions
Unlike other federal tax benefits designed to help families pay for college, it doesn't matter how much income you have. Any U.S. citizen or resident alien 18 years or older who has a Social Security number or taxpayer identification number and a permanent address that is not a P.O. Box can open an account.
Ready to enroll? Select the 529 plan that's right for you.
The Pennsylvania 529 Guaranteed Savings Plan, in which growth keeps up with tuition increases.***
The Pennsylvania 529 Investment Plan, with 13 investment options that allow you to be as conservative or aggressive as you choose.
* The availability of tax or other benefits may be contingent on meeting other requirements. A withdrawal or a portion of a withdrawal not used to pay for qualified expenses may be subject to federal income tax and a 10 percent federal penalty tax, as well as state and local income taxes.
** In the event the donor does not survive the five-year period, a pro-rated amount will revert to the donor's taxable estate.
*** The guarantee is that, when used for qualified higher education expenses, your contributions will grow at the rate of tuition inflation at a Tuition Level that you choose. If the applicable GSP Credit Rate at the time a contribution is made has a premium, however, your rate of growth will be lower than the actual rate of tuition inflation at your Tuition Level by approximately the rate of the premium. Premiums do not, however, alter the way in which the dollar value of your account is determined. When used for qualified higher education expenses, each GSP Credit will still have the full value of the actual per credit tuition cost. The guarantee is an obligation of the Pennsylvania GSP Fund only. The guarantee is not backed by the full faith and credit of the Commonwealth of Pennsylvania, and is not an obligation of the Commonwealth of Pennsylvania, the Pennsylvania Treasury Department, Upromise Investments, Inc., Upromise Investment Advisors, LLC, or any other party. The GSP is not insured by the Federal Deposit Insurance Corporation or any other government agency.
For more information about the Pennsylvania College Savings Program—529 Investment Plan, download a Disclosure Statement or request one by calling 800-294-6195. Investment objectives, risks, charges, expenses, and other important information are included in the Disclosure Statement; read and consider it carefully before investing. Vanguard Marketing Corporation serves as Distributor and Underwriter. If you are not a Pennsylvania taxpayer, consider before investing whether your or the designated beneficiary's home state offers any state tax or other benefits that are only available for investments in such state's qualified tuition program.
The Pennsylvania College Savings Program—529 Investment Plan is authorized by the Commonwealth of Pennsylvania and administered by the Pennsylvania Treasury Department. Upromise Investments, Inc., and Upromise Investment Advisors, LLC, serve as the Program Manager and Recordkeeping and Servicing Agent, respectively, with overall responsibility for the day-to-day operations, including effecting transactions. The Vanguard Group, Inc., serves as Investment Manager for the Investment Plan. Vanguard Marketing Corporation, an affiliate of The Vanguard Group, Inc., markets and distributes the Investment Plan. The Investment Plan's portfolios, although they invest in mutual funds, are not mutual funds.
Investment returns are not guaranteed, and you could lose money by investing in the Investment Plan.
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