Employee College Savings Program

You can contribute to a ScholarShare 529 account by any of the following: check, electronic funds transfer, establishing a recurring contribution, establishing payroll direct deposit, rollover from another state’s 529 plan account, or redemption proceeds from a Coverdell Education Savings Account or qualified U.S. savings bond. Your contribution will be invested according to your allocation instructions, which you may change at any time online, by telephone or by requesting and submitting the Change of Investment Form.

Yes. Whether you have recently moved to the state, have an underperforming or higher-cost 529 plan, or just want to simplify, consolidating 529 accounts into ScholarShare 529 is easy. You can transfer funds from another 529 plan to your ScholarShare 529 account for the same beneficiary once within a 12-month period without incurring tax penalties.

Consolidating education savings into ScholarShare 529 also gives you a single view of your savings and performance as well as single-step payments to colleges, universities, K-12 schools, etc.¹

You may also save money that can go right back into your college fund. ScholarShare 529 expenses are less than half the national average for 529 plans.² You pay no sales charges, start up or maintenance fees.

The 529 plan from which you are transferring funds may be subject to different features, costs and surrender charges. As such, you should consult your tax advisor or the other 529 college savings plan prior to making any decisions. For more information, see How to manage an incoming rollover from another 529 saving plan account.

Footnotes

1. ¹Withdrawals for tuition expenses at a public, private or religious elementary, middle, or high school can be withdrawn free from federal tax. For California taxpayers these withdrawals are subject to state income tax and an additional 2.5% California tax. You should talk to a qualified professional about how tax provisions affect your circumstances. K-12 withdrawals are limited to $10,000 per year for K-12 tuition.↩
2. ²Source: ISS Market Intelligence 529 College Savings Fee Analysis 3Q 2023. ScholarShare 529’s average annual asset-based fees are 0.21% for all portfolios compared to 0.51% for all 529 plans.↩

Qualified higher education expenses include tuition, certain room and board expenses, fees, books, supplies and equipment required for the enrollment and attendance of the beneficiary at an eligible educational institution. This includes most postsecondary institutions. When used primarily by the beneficiary enrolled at an eligible educational institution, computers and related technology such as internet access fees, software or printers are also considered qualified higher education expenses.

Qualified higher education expenses also include certain additional enrollment and attendance costs at eligible educational institutions for any beneficiary with special needs.

Qualified higher education expenses also include (a) tuition in connection with enrollment or attendance at a primary or secondary public, private or religious school (up to a maximum of $10,000 of distributions per taxable year per beneficiary from all Section 529 programs)¹; (b) expenses for fees, books, supplies and equipment required for the participation of a beneficiary in a certified apprenticeship program²; and (c) amounts paid as principal or interest on any qualified education loan of either the beneficiary or a sibling of the beneficiary (up to a lifetime limit of $10,000 per individual).² Review the Plan Description for additional information, including the state tax treatment of withdrawals for these expenses.

Footnotes

1. ¹Withdrawals for tuition expenses at a public, private or religious elementary, middle, or high school can be withdrawn free from federal tax. For California taxpayers these withdrawals are subject to state income tax and an additional 2.5% California tax. You should talk to a qualified professional about how tax provisions affect your circumstances.↩
2. ²Withdrawals for registered apprenticeship programs and student loans can be withdrawn free from federal and California income tax. If you are not a California taxpayer, these withdrawals may include recapture of tax deduction, state income tax as well as penalties. You should talk to a qualified professional about how tax provisions affect your circumstances.
   
   Apprenticeship programs must be registered and certified with the Secretary of Labor under the National Apprenticeship Act.↩

Anyone with a valid Social Security number or taxpayer identification number can open a ScholarShare 529 account. Accounts can be opened online or by downloading enrollment materials.

You can also open an account by requesting a mailed enrollment kit online or by giving us a call at 800-544-5248.