Bright Start/College Funds in Illinois

[Minnie824]

I figured someone here may have some information on this. We had started a Bright Start account for DD2 but now I've hear that things will change in 2010 regarding taxes (not sure of the details) and if you have kids under 10 yo you should look into something else. Problem is, I'm not sure what else to look into, or whats available, or a good program. Does anyone have any information on this or know where I can get it? Thanks!

 

[Toby'sFriend]

The Illinois Bright Start plan is a 529 savings plan which lets your earnings grow tax free and also lets you make tax free withdrawals for qualified educational expenses. The federal law which established 529 plans is set to expire in 2010, but I honestly can't imagine that any politician would push such an unpopular decision as not extending the tax benefits. But I guess that is always possible. If you are an Illinois resident, you will also get a State Tax deduction for contributions to this plan.

A couple of other options are an Educational IRA or College Illinois which is a prepaid tuition program.

You can read about some of this here
http://www.kiplinger.com/tools/managing/college/savings/2001/IL.htm