Administrators at the state’s college savings plan want Oklahomans to learn about the program, and they have developed an incentive plan they think will be hard to pass up: free tickets to Oklahoma and Oklahoma State football games.
Visitors to the Oklahoma College Savings Plan’s Web site can sign up to win football tickets. While there is no obligation to enter, officials hope visitors will learn about the program and eventually participate, said state Treasurer Scott Meacham, chairman of the savings plan board.
“We’re always trying to build awareness,” Meacham said. “One of our biggest challenges is building awareness and so we though what better way than to tie it to football season in Oklahoma.”
The Oklahoma College Savings Plan offers state and federal tax advantages. It is the only tax-advantaged college savings plan with an Oklahoma income tax deduction.
Introduced in April 2000, contributions to an Oklahoma College Savings Plan account grow free from federal and state income taxes. Withdrawals for qualified expenses are also free from federal and state income taxes.
Higher Education Chancellor Glen Johnson said the college savings plan is a good tool that families can use to help prepare in advance for the cost of college.
“Oklahoma has one of the best plans in the country and participation in the program now exceeding 35,000 college savings accounts,” Johnson said. “These numbers are significant in today’s global economy and show that Oklahomans recognize that a college education is the best investment for the future.”
Participation in the program increased 16 percent during the past year, from 30,791 to 35,734 accounts, according to the state treasurer’s office.
Invested funds increased 38 percent, from $192 million to about $266 million. The average size of the accounts increased 19 percent, from $6,233 to $7,434.
Increased participation is credited in part to legislation approved last year that changed the deadline for contributions from Dec. 31 to April 15 to qualify for a state tax deduction on the preceding year’s income tax return.
“It makes a huge difference,” as it helped Oklahomans get more focused on the plan’s tax benefits as they prepared their income taxes, Meacham said.
Under the plan, Oklahoma taxpayers can deduct up to a maximum of $10,000 a year, $20,000 if married and filing jointly, on their Oklahoma income taxes.
All earnings on contributions to a college savings plan account are deferred and become permanently tax-free when qualified withdrawals are made to pay college tuition, fees, room and board and other student expenses.
Funds can be used at nearly any college in the nation.
The Oklahoma College Savings Plan was among those listed this month by Money magazine as a good investment for state residents. The magazine complimented the plan for its low expenses and for providing in-state savers with a tax break on contributions.
New York-based TIAA-CREF Tuition Financing, Inc., which has a contract with the state to administer the plan, does all investing of funds as well as marketing. It is paid a fee of between 0.79 to 1 percent of how much money is in the college savings fund.
On the Net:
Oklahoma College Savings Plan at https://www.oklahoma529.com/
Information from: The Oklahoman, https://www.oklahoman.com/
– Associated Press
© Copyright 2005 by DiverseEducation.com