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529 PLANS

U.Plan

Massachusetts

The Massachusetts U.Plan, not a true 529 plan, issues Massachusetts general obligation bonds (federal and MA state tax-free) which will be accepted at participating Massachusetts institutions in payment of tuition.

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)

Financial benefits Safety Features Reliability
4.0 5.0 3.0 4.0

General

Program type:

Prepaid contract

How to enroll:

Enroll directly with the program.

Initial year of operation:

1995

State agency(ies):

Massachusetts Educational Financing Authority (MEFA)

Enrollment period:

Typically May and June each year.

Eligibility

State residency requirements:

None

Who can be a participant/owner in the program?

Individuals

Significant time or age restrictions imposed by the program:

A tuition certificate must be redeemed within 6 years after its maturity date.

Contributions

Maximum contributions:

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Minimum contributions:

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Contractual Features

Contract prices:

Ranges from a minimum of $300 to as much as the cost of four years of tuition at the highest-cost participating institution.

Available tuition packages:

Massachusetts general obligation bonds that may be redeemed for a pre-determined percentage of tuition and fees at a participating Massachusetts institution.

Benefits for beneficiary attending private or out-of-state institution:

Participating private institutions in MA are covered by the U.Plan. Use at non-participating and out-of-state institutions provides a return of principal plus interest compounded annually equal to the Consumer Price Index.

Contract payment options:

Lump sum only.

Are program benefits backed by the full faith and credit of the state?

Yes

Are program benefits collateralized or guaranteed in any other way?

No

Fees & Expenses

Enrollment or application fee:

None.

Taxes and other Benefits

Program match on contributions:

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State tax deduction or credit for contributions:

None.

State tax treatment of qualified distributions:

As a Massachusetts general obligation bond, earnings from the U.Plan are exempt from Massachusetts tax. Massachusetts law also exempts qualified distributions from Massachusetts and non-Massachusetts 529 plans.

State tax treatment of rollovers:

Not applicable. Because U.Plan is not a 529 plan, rollovers into U.Plan are not eligible for federal or state tax-free treatment.

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

No

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?

No

Statutory protection of an account from creditors:

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Distributions & Terminations

To whom are distributions made payable:

Account owner or eligible educational institution.

Account Changes

Policy regarding participant/owner changes:

Accepts changes to ownership with appropriate documentation.

Contact

Web site:

Click here to visit

Telephone:

1-800-449-6332

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