General InformationDownload PDF Report
Kentucky Education Savings Plan Trust
The Kentucky Education Savings Plan Trust is similar to other TIAA-managed 529 savings programs. The Plan features an age-based option, two 100% equity options, a balanced option, a fixed income option, and a guaranteed option.
- Program typeSavings
- State agencyKentucky Higher Education Assistance Authority
- Tax deductionTax deduction for single filers NoneTax deduction for joint filers None
- Program ManagerTIAA-CREF Tuition Financing, Inc.
- Program distributorTIAA-CREF Individual & Institutional Services, LLC
- Manager contract termUNLOCK PRO
Ratings & Rankings
Our overall rating for non-residents
This is a very good program that offers valuable benefits but may have some limitations or concerns that investors need to know.
Each plan's performance score is developed directly from Savingforcollege.com's Quarterly 529 Performance Rankings. A 529 savings plan must have at least one year of performance history before they will be assigned a 5-cap rating. For those plans that are not part of our quarterly performance rankings, such as plans offering a single set of bank-based investment options, we assign a performance score by evaluating the returns currently available on similar types of investments outside of 529 plans.
State residency requirements:None
Who can be a participant/owner in the program?U.S. citizens and resident aliens at least 18 years old, UGMA/UTMA custodians, and legal entities.
Significant time or age restrictions imposed by the program:None
Maximum contributions:Accepts contributions until all account balances in Kentucky's 529 plans for the same beneficiary reach $350,000.
Minimum contributions:$25, or $15 per pay period via payroll deduction.
Age-based investment options:The Managed Allocation Option contains 9 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.View more age-based investment options
Static investment options:Select among 2 100% equity options (one using actively managed funds and the other using mostly index funds), a balanced option, a fixed income option, and the Guaranteed Option.View more static investment options
Underlying investments:TIAA-CREF institutional mutual funds; the Guaranteed Option is invested in a funding agreement with TIAA-CREF Life Insurance Company that guarantees principal and a minimum 1% annual rate of interest (actual rate is declared annually and as of July 1, 2017 is 1.50% till June 30, 2018).View a full list of this plan's investment options
Underlying fund allocations:UNLOCK PRO
Portfolio Fees & Performance LookupUNLOCK PRO
Fees & Expenses
Enrollment or application fee:None.
Account maintenance fee:None.
Program management fees:0.60% manager fee for the Managed Allocation option includes underlying fund expenses; 0.47% manager fee for the Equity Index, Balanced, and Fixed Income options, and 0.41% fee for the Active Equity Option, which do not include underlying fund expenses. No fee for the Guaranteed Option.
Expenses of the underlying investments:Managed Allocation Option: included in the program management fee.
100% equity options: 0.07% to 0.50%
Balanced Option: 0.26%
Fixed Income Option: 0.16%
Total asset-based expense ratio:0.54% - 0.91%. None for the Guaranteed Option.
Taxes and other Benefits
- Tax deduction for single filersNone
- Tax deduction for joint filersNone
Kentucky doesn't offer tax deductions
Program match on contributions:None.
State tax deduction or credit for contributions:None.
State definition of qualified expensesThe state conforms with the federal definition of qualified education expenses, which includes expenses for higher education, as well as up to $10,000 per year in tuition in connection with enrollment or attendance at an elementary or secondary public, private, or religious school.
State tax treatment of qualified distributions:Qualified distributions from Kentucky and non-Kentucky 529 plans are exempt.
State tax treatment of rollovers:Kentucky follows federal tax-free treatment. The intent of the Kentucky statutes that govern the Kentucky Education Savings Plan Trust is to conform with the IRS 529 tax code. The recent federal tax reform law, the "Tax Cuts and Jobs Act" signed into law on December 22, 2017, made changes to the IRS 529 tax code which will require that the Kentucky Higher Education Assistance Authority (KHEAA) change specific statutory provisions to maintain this conformity. Among other changes, the tax reform law expands the use of 529 savings accounts to include tuition costs for K-12 education, up to $10,000/year. This will apply prospectively only for costs incurred in or after 2018. Rules and definitions for this change are still being determined on the federal level. KHEAA's 529 plan will continue to conform with the IRS tax code, and we will make any needed changes once the specific provisions are determined.
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?Yes, beneficiaries with eight years of program participation and $2,400 in total contributions who move out-of-state remain eligible for resident tuition rates at Kentucky public institutions
Does the program have a formal agreement with a rewards program or outside scholarship program?Yes, the Upromise Rewards program can be linked to any 529 college savings plan. Upromise Rewards is free to join and offers members cash back for college.
Statutory protection of an account from creditors:UNLOCK PRO
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