529 PLANS

Michigan Education Trust NEW! PDF ReportPRO

Michigan

The Michigan Education Trust prepaid tuition program offers several options to the Michigan family to lock in tuition at Michigan public institutions. What makes this program different than most is that contributions are irrevocable.

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
3.00 4.00 3.00 3.00

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General

Program type:

Prepaid contract

How to enroll:

Enroll directly with the program.

Initial year of operation:

1988

State agency(ies):

MET Board of Directors and Department of Treasury

Enrollment period:

The Enrollment Period to purchase MET contracts is December 1, 2017 - September 30, 2018.

Eligibility

State residency requirements:

The beneficiary must be a Michigan resident at the time of program enrollment.

Who can be a participant/owner in the program?

U.S. residents at least 18 years old, UGMA/UTMA custodians, and legal entities. A MET contract cannot be purchased by residents of Arizona, Illinois, New York, North Dakota, Ohio, or Vermont.

Significant time or age restrictions imposed by the program:

Contract benefits must be used within 15 years after the projected college entrance date.

Contributions

Minimum contributions:

In the December 2017 - April 2018 enrollment, $1,644 for a one-semester Community College contract purchased in a lump sum for a newborn, installment available for as low as $14 per month.

Contractual Features

Contract prices:

2017-18 Enrollment:
MET contracts offer three purchase options: Lump Sum, Pay-As-You-Go, and Monthly.

The Pay-As-You-Go option allows purchases of credit hours. From December 1, 2017 to April 30, 2018, prices range from $110 per credit hour for a community college contract to $589 per credit hour for a full benefits contract. From May 1, 2018 to September 30, 2018 prices range from $111 to $594.

Monthly purchases are available in four, seven, ten, and fifteen year increments, depending on the age of the beneficiary. From December 1, 2017 to April 30, 2018 payments range from $14 for community college benefits (newborn to age 3) to $1,688 for full benefits (newborn to 8th grade). From May 1, 2018 through September 30, 2018, prices range from $14 to $1,704.

For the period of December 1, 2017 through April 30, 2018, lump sum prices range from as little as $1,644 for a one-semester community college contract to as much as $70,576 for a four-year full benefits contract. From May 1, 2018 to September 30, 2018 prices range from $1,660 to $71,280.

Available tuition packages:

The Full Benefits contract pays for one to ten semesters of tuition and mandatory fees at any Michigan public institution; the Limited Benefits contract pays for one to ten semesters of tuition and mandatory fees at Michigan public institutions up to 105% of the weighted average tuition of all Michigan four-year universities; and the Community College contract pays one to four semesters of in-district tuition and mandatory fees at any Michigan public community college.

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

Weighted average public tuition if used at in-state private colleges and the average public tuition if used out-of-state.

Contract payment options:

Lump sum, or monthly over 4 years, 7 years, 10 years, or 15 years. Date when payments begin under a monthly purchase contract depends on when the contract is submitted. Pay-As-You-Go option requires a minimum initial purchase of one-credit hour, but subsequent purchases can be made at any time in minimum increments of $25. Pay-As-You-Go contracts must be completed 45 days before use.

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

No

Are program benefits collateralized or guaranteed in any other way?

No

Fees & Expenses

Enrollment or application fee:

On-line enrollment: $25
Enrollment by mail: $60

Taxes and other Benefits

Program match on contributions:

PRO Premium subscription required for this data.

State tax deduction or credit for contributions:

Contributions to the Michigan Education Trust are fully deductible from Michigan taxable income. Rollover contributions are not eligible for the deduction, according to the Michigan Department of Treasury.

State tax recapture provisions:

The principal portion of nonqualified withdrawals from this plan are included in Michigan taxable income to the extent of prior Michigan tax deductions. Qualified rollovers are not subject to recapture.

State tax treatment of qualified distributions:

Qualified distributions from Michigan and non-Michigan 529 plans are exempt. Also excluded are distributions made due to the beneficiary's death, disability, scholarship, or attendence at one of the U.S. military academies.

State tax treatment of rollovers:

Michigan follows federal tax-free treatment.

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?

No

Statutory protection of an account from creditors:

PRO Premium subscription required for this data.

Distributions & Terminations

To whom are distributions made payable:

To the higher education institution if beneficiary is attending college; to the refund designee name in the MET contract if beneficiary is not attending college

Account Changes

Policy regarding participant/owner changes:

The contract purchaser cannot transfer rights in the contract during lifetime.

Contact

Website:

http://www.michigan.gov/setwithmet

Telephone:

1-800-638-4543

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