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529 PLANS

CollegeChoice 529 Direct Savings Plan

Indiana

In September 2008, Upromise Investments took over the management of the Indiana CollegeChoice 529 Direct Savings Plan from JPMorgan, and it now features an age-based option using Vanguard index and Loomis Sayles funds, seven individual portfolios using a variety of investment managers, and an FDIC-insured savings account from Sallie Mae Bank. Accounts can be linked to the Upromise rewards service.

5-Cap Rating

Resident:
Non-Resident:

Savingforcollege.com's 5-Cap Ratings provides an evaluation and comparison of 529 plans, utilizing a formula that examines dozens of factors grouped into the following categories. (Scale 0 to 5; 5 is highest)

Performance Costs Features Reliability Resident Upgrade
3.14 3.37 3.40 4.00 0.55

General

Program type:

Savings

How to enroll:

Enroll directly with the program.

Initial year of operation:

1997, but substantially changed in 2008

State agency(ies):

Indiana Education Savings Authority (IESA)

Program manager:

Upromise Investments, Inc.

Program distributor:

Upromise Investments, Inc.

Manager contract term:

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Eligibility

State residency requirements:

None

Who can be a participant/owner in the program?

U.S. citizens and resident aliens at least 18 years old, emancipated minors, UGMA/UTMA custodians, and legal entities.

Significant time or age restrictions imposed by the program:

For Indiana taxpayers claiming a state tax credit on contributions, the account must remain open for at least one year to avoid recapture of the tax credit on distributions used to pay qualified education expenses.

Contributions

Maximum contributions:

Accepts contributions until all account balances in Indiana's 529 plan for the same beneficiary reach $298,770.

Minimum contributions:

$25

Investment Options

Age-based investment options:

The Age-Based Program contains 7 portfolios of underlying mutual funds. Contributions are placed into the portfolio corresponding to the beneficiary's age, and later reassigned to more conservative portfolios as the beneficiary approaches college age.

Static investment options:

Select among 7 options using various investment managers--Active Bond, International, Bond Index, Money Market, Short Term Bond Index, U.S. Equity Index, and Inflation-Protected--plus a FDIC-insured Savings Portfolio.

Underlying investments:

Age-Based Option: Vanguard index funds, Loomis Sayles, and money market fund
Individual Portfolios: Mutual funds from Dodge & Cox, Scout Investments, Vanguard, and Western Asset.
The Savings Portfolio invests in the Sallie Mae High-Yield Savings account.

Underlying fund allocations:

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Investment performance link:

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Portfolio Fees & Performance Lookup

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Fees & Expenses

Enrollment or application fee:

None.

Account maintenance fee:

$20 annually, waived for Indiana residents or beneficiaries and for accounts with $25,000.

Program management fees:

0.42% in the Age-based option; 0.27% in the Individual Portfolios and Savings Portfolio

Expenses of the underlying investments:

Ranges from 0.08% to 0.15% in the Age-based option and from 0.02% to 0.64% in the Individual portfolios (portfolio weighted average). None in the Savings Portfolio.

Total asset-based expense ratio:

0.27% - 0.91%

Taxes and other Benefits

Program match on contributions:

None.

State tax deduction or credit for contributions:

A 20% tax credit on up to $5,000 per year in contributions to an Indiana 529 plan can be claimed against Indiana income tax (maximum yearly credit is $1,000). Effective January 1, 2010, rollover contributions and contributions generated through a rewards program are not eligible for the credit.

Value of in-state tax benefits:

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State tax recapture provisions:

An account owner must pay with the Indiana tax return a tax equal to the 20 percent of a nonqualified withdrawal from this plan, to the extent of Indiana tax credits previously claimed. Nonqualified withdrawals for this purpose include rollovers but do not include withdrawals made as the result of the beneficiary's death or disability or withdrawals made on account of the beneficiary's receipt of a scholarship. Recapture will apply to any account terminated within 12 months from account opening date.

State tax treatment of qualified distributions:

Qualified distributions from Indiana and non-Indiana 529 plans are exempt.

State tax treatment of rollovers:

Indiana follows federal tax-free treatment except that outbound rollovers are subject to the recapture of prior state tax credits.

Does the sponsoring state exclude the value of an account for state financial aid purposes?

Yes

Does participation in the program provide beneficiaries with any advantages in qualifying for resident tuition status at state institutions?

No

Does the program have a formal agreement with a rewards program or outside scholarship program?

Yes, with the Upromise rewards service. CollegeChoice 529 also offers a credit card, the SALLIE MAE 529 REWARDS World Elite MasterCard issued by Sallie Mae Bank, that earns rewards on qualified retail purchases that are automatically transferred into the owner's 529 account on a periodic basis.

Statutory protection of an account from creditors:

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Distributions & Terminations

To whom are distributions made payable:

Eligible educational institution, beneficiary, or account owner, as directed by the account owner.

Account Changes

Policy regarding participant/owner changes:

Accepts requests to transfer account ownership.

Documents, Access & Reporting

Does participant have online password-protected access to account?

Yes

Can the complete enrollment process including funding be done online?

Yes

Documents and other services accessible or downloadable on the program's public Web site:

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Contact

Web site:

Click here to visit

Telephone:

1-866-485-9415