Anyone can be a beneficiary, regardless of age. Your beneficiary can be your child, grandchild, nephew, niece, or even yourself.
Q: Is my beneficiary required to attend an Oregon college or university?
No. Beneficiaries of Oregon college savings plans can attend any eligible educational institution in the U.S. and abroad, including vocational schools, technical schools, two- and four-year colleges and graduate schools.
Q: How many accounts can a beneficiary have in his/her name?
There is no limit to the number of accounts a beneficiary can have in his/her name; however, the total balance of all accounts for a single beneficiary cannot exceed $310,000.
Q: How many accounts can I own?
You can own as many accounts as you like.
Q: What if my beneficiary decides not to go to college?
If your beneficiary decides not to attend college, you have three options:
| You can continue to let the assets grow tax free, since there are no age
restrictions on the investments in the 529 plans. You can change the beneficiary at any time, as long as the new beneficiary is a family member of the current beneficiary. You can take a nonqualified withdrawal, and the earnings will be taxed at the account owners' ordinary income-tax rate in addition to a 10% federal tax. |
Q: What if my beneficiary receives a scholarship?
You can withdraw an amount equal to the value of the scholarship from
your account without being subject to the 10% additional federal tax.
However, the earnings will be taxed at the account owner's ordinary
income-tax rate if not used for qualified expenses not covered by the
scholarship (such as books and other required supplies). You can also
leave the money in the account and/or change the beneficiary.
Q: How much can I contribute to an Oregon 529 college savings plan?
There is no contribution limit. However, once the total balance of all
accounts for a single beneficiary reaches $310,000, no more
contributions can be made for that beneficiary until the total amount
drops below $310,000.
Q: What is the minimum contribution to an Oregon 529 college savings
plan?
The minimum investment to open an account is $250. That minimum is
waived if you use our automatic investment option of just $25 per month.
Q: Are earnings and withdrawals state or federally tax-free?
If used for Qualified Higher Education Expenses, investment earnings and
withdrawals are both state and federally tax-free.
Q: What are Qualified Higher Education Expenses?
Qualified Higher Education Expenses include tuition, fees, books,
supplies and equipment required for the enrollment or attendance of a
designated beneficiary at an eligible educational institution. Qualified
expenses also include expenses for special needs services in the case of
a special needs beneficiary who incurs such expenses in connection with
enrollment or attendance at an eligible educational institution. Also
included as a qualified higher education expense is an amount for the
room and board a student incurs while attending an institution at least
half-time.
Q: Is there an Oregon State tax deduction on contributions each year?
Yes. The allowable state tax deduction is $4,000 annually for joint filers. It is $2,000 for single and all other filers. However, as cited in ORS 316.699(3)(a) & (b), these amounts are adjusted annually according to the U.S. City Average Consumer Price Index. Click here to see the amounts for the current tax year: 2009 State Tax Deduction Increase
Q: If I participate in a 529 college savings plan that is not managed by
the State of Oregon, can I still take the state tax deduction?
No. The Oregon State tax deduction applies only to plans managed by the
State of Oregon. Those plans are the Oregon College Savings Plan, the
OppenheimerFunds 529 Plan, and the MFS 529 Savings Plan.
Q: Who is eligible to take the Oregon state tax deduction?
Anyone who pays Oregon State taxes and contributes to a 529 plan managed
by the State of Oregon can take a tax deduction for contributions of up
to $2,000 per year for single filers and $4,000 per year for joint
filers.
Q: If I contribute $4,000 to an Oregon 529 plan and my spouse
contributes $4,000 to an Oregon plan, are we both eligible for the
$4,000 state tax deduction?
No. $4,000 is the maximum deduction couples can take per tax return, per
year. A $2,000 tax deduction can be taken per person if married and
filing separately.
Q: Is there an income ceiling for taking the Oregon State tax deduction when contributing to an Oregon 529 college savings plan?
No. There are no income limits.
Q: What is the contribution deadline for the Oregon state tax deduction?
Contributions can be made up to April 15 for a deduction in the previous
tax year, or prior to filing your state tax return, whichever is
earlier.
Q: Can I open an Oregon 529 college savings plan for a beneficiary who
does not live in Oregon? If yes, will my contributions to that plan be
eligible for the Oregon State tax deduction?
Yes. The beneficiary of an Oregon 529 college savings plan can live in
any state and can use the 529 savings to attend an eligible educational
institution anywhere in the United States or abroad. If you pay Oregon
income taxes, contributions to an Oregon plan for an out-of-state
beneficiary are eligible for the state tax deduction.
Q: Must I be the account owner to claim the Oregon State tax deduction
for contributions to an Oregon 529 college savings plan?
No. Anyone who contributes to an Oregon 529 college savings account and
pays Oregon income taxes is eligible to take the allowable state tax
deduction for their contributions ($2,000 for single filers and $4,000
for married couples filing jointly).
Q: If I open an account for more than one beneficiary, can I take the
state tax deduction for each beneficiary?
No. The maximum state tax deduction allowed per year is $2,000 for
single or married filing separately filers and $4,000 for married people
filing jointly. This amount can include contributions to more than one
account, but the total deduction cannot exceed the maximum allowed.
Q: If I contribute more than the maximum state tax deduction to my
Oregon 529 plan in one year, can I use the remainder towards the state
tax deduction in the following years?
Yes. You can roll forward any contribution in excess of the yearly
maximum allowed for up to four years. For example, if an account owner
who is married and filing jointly contributes $20,000, he or she may
take a $4,000 state tax deduction that year and for each of the
following four years (up to $10,000 if single or married filing
separately). This process can be repeated every five years.