Education Planning Common Questions

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Who can legally offer 529 plans?

Answer

It depends on the type of 529 plan. There are two types of 529 plans – state savings plans and prepaid tuition plans. With state savings plans, only states are allowed to operate them. With prepaid tuition plans, both states and colleges are allowed to operate them. To gain favorable federal tax treatment, any state savings plan or prepaid tuition plan must meet all of the requirements of Section 529 of the Internal Revenue Code.

Note: As a practical matter, states designate an agent (usually a financial institution or other professional money manager) to manage their particular state savings plan or prepaid tuition plan.

GE 38066 (03/07)

If you are investing in a 529 plan outside of your state of residence, you may lose available state tax benefits. Make sure you understand your state tax laws to get the most from your plan.

529 plans are subject to enrollment, maintenance, administration/management fees and expenses. 529 plans are subject to fluctuation in value and market rise, including loss of principal.

Investors should consider the investment objectives, risks, charges, and expenses of 529 plans carefully before purchasing. More information about 529 plans can be found in the issuer's official statement. Please read the official statement carefully before investing.

AXA Equitable does not provide legal or tax advice.

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