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Summary

Upromise Investments, Inc., which was acquired by Ascensus College Savings in 2013, became manager of the Indiana CollegeChoice Advisor 529 Savings Plan in September 2008, replacing JPMorgan. The plan uses BlackRock, Schwab, DFA, American Funds, T.Rowe Price, Carillon Tower Advisors and Vanguard funds in its Year of Enrollment Option and mutual funds from various investment managers in its individual portfolios. The plan also offers an FDIC-insured Savings Portfolio from NexBank and the Capital Preservation Portfolio invested in the New York Life Guaranteed Interest Account. Accounts can be linked to the Upromise Rewards service.

Program type

Savings

How to enroll

Enroll through a financial advisor.

Initial year of operation

1997, but substantially changed in 2008

State agency(ies)

Indiana Education Savings Authority (IESA)

Program manager

Ascensus College Savings

Program distributor

Ascensus College Savings

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.

Maximum contributions

Accepts contributions until all account balances in Indiana's 529 plan for the same beneficiary reach $450,000.

Minimum contributions

$25

Does the program offer an e-gifting platform for receiving gift contributions?

This plan offers a robust gifting platform that allows gift-givers to save their own profile for recurring or future contributions.

Age-based/Enrollment Year investment options

The Year of Enrollment option contains 8 portfolios of underlying mutual funds. Contributions are placed into the portfolio corresponding to the anticipated year of college enrollment, and reassigned to the College Portfolio upon reaching that year.

Static investment options

Select among 12 individual-fund portfolios with various investment managers. An FDIC-insured bank savings option and capital preservation option are also offered.

Underlying investments

Vanguard, Schwab, BlackRock, DFA, American Funds, T. Rowe Price, Carillon Tower Advisors, Diamond Hill, PIMCO. The Savings Portfolio invests in the NexBank High-Yield Savings account and the Capital Preservation Portfolio invests in the New York Life Guaranteed Interest Account.

Enrollment or application fee

None, but contributions may be subject to a sales charge depending on share class.

Account maintenance fee

$20 annually, waived for accounts with an Indiana resident as owner or beneficiary and for accounts with balances of $25,000 or more.

Program management fees

0.39% manager fee (includes 0.08% state administrative fee) plus distribution expenses of 0.25% (Class A) or 1.00% (Class C), none for Class I. The Savings Portfolio and Capital Preservation Portfolio are subject to a 0.31% manager fee.

Expenses of the underlying investments

Ranges from 0.02% to 0.05% in the Year of Enrollment portfolio option and from 0.03% to 0.76% in the Individual portfolio options (portfolio weighted average). None for the Capital Preservation or Savings Portfolio.

Total asset-based expense ratio

Class A: 0.66% - 1.40%
Class C: 1.41% - 2.15%
Class I: 0.41% - 1.15%
Savings Portfolio - 0.31%
Capital Preservation Portfolio - 0.31%

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. Effective January 1, 2020, the definition on an Indiana taxpayer was revised to include married individuals filing separately. The maximum annual credit allowed for a married taxpayer filing separately is $500.

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 accounts terminated within 12 months from account opening date.

State definition of qualified expenses

The state definition of qualified education expenses includes expenses for higher education and apprenticeship programs, 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. Education loan repayments are not considered as a qualified education expense.

For Indiana state income tax purposes, a withdrawal for payment of K-12 Tuition Expenses at a K-12 school which is not located in Indiana will be treated as a non-qualified withdrawal and taxed as income to the extent previously deducted as a contribution to the College Choice 529 Direct Savings Plan.

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

Is there a rewards program or outside scholarship program that works with this 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.

To whom are distributions made payable

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

Policy regarding participant/owner changes

Accepts requests to transfer account ownership.

Does participant have online password-protected access to account?

Yes

Can the complete enrollment process including funding be done online?

No

Telephone

1-866-485-9413