Estate Planning: Benefits of a 529

January 04, 2021

Learn how 529 plans can help you:

• reduce current and future tax liability

• pass wealth on to children, grandchildren and future generations

• fully control assets even though assets are outside your estate

Download the White Paper

Squeeze 6 Years of Gifting into just 2 Months

November 30, 2020

Take advantage of the 2020 annual gift tax exclusion of up to $15,000 ($30,000 for joint filers), without incurring federal gift tax.

The Annual Gift Tax Exclusion for 2020 is $15,000 per individual. This planning assumes no other gifts being made to the donee by the contributor. Contributions to an account for a beneficiary between $15,000 and $75,000 can be prorated over a five-year period without incurring federal gift taxes or reducing an investor's unified estate and lifetime gift tax credit amount of $11.58 million (2020). If the account owner dies before the end of the five-year period, a prorated portion of the contribution will be included in his or her taxable estate. Federal gift taxation may result if a contribution exceeds the available annual gift tax exclusion amount remaining for a given beneficiary in the year of contribution if the investor has used up his/her unified estate and gift tax credit.

All information contained herein is intended for general informational purposes only. Such information does not constitute legal, tax or financial advice on the part of Franklin Resources, Inc. and its affiliates. Investors should consult with their legal, tax and financial professionals concerning their personal circumstances. The information contained herein is derived from publicly available sources, but its accuracy cannot be guaranteed.

An investor should consider the Program’s investment objectives, risks, charges and expenses before investing. The Program Disclosure Statement and Participation Agreement (www.scholars-choice.com/pds) contains more information and should be read carefully before investing. If an investor and/or an investor’s beneficiary are not Colorado taxpayers, they should consider before investing whether their home states offer 529 plans that provide state tax and other benefits such as financial aid, scholarship funds and protection from creditors that are only available to state taxpayers investing in such plans.

Investments in the Scholars Choice College Savings Program are not insured by the FDIC or any other government agency and are not deposits or other obligations of any depository institution. Investments are not guaranteed by the State of Colorado, CollegeInvest, QS Investors, LLC, Legg Mason Investor Services, LLC, or Franklin Resources, Inc., or its affiliates and are subject to risks, including loss of principal amount invested.

Franklin Resources, Inc., its affiliates, and its employees are not in the business of providing tax or legal advice to taxpayers. These materials and any tax-related statements are not intended or written to be used, and cannot be used or relied upon, by any such taxpayer for the purpose of avoiding tax penalties or complying with any applicable tax laws or regulations. Tax-related statements, if any, may have been written in connection with the “promotion or marketing” of the transaction(s) or matter(s) addressed by these materials, to the extent allowed by applicable law. Any such taxpayer should seek advice based on the taxpayer’s particular circumstances from an independent tax advisor.

Scholars Choice is a registered service mark of CollegeInvest. CollegeInvest and the CollegeInvest logo are registered trademarks. Administered and issued by CollegeInvest, State of Colorado. QS Investors, LLC is the Investment Manager and Legg Mason Investor Services, LLC is the primary distributor of interests in the Program; together they serve as Manager of the Program. QS Investors, LLC and Legg Mason Investor Services, LLC are subsidiaries of Franklin Resources, Inc. Such entities became subsidiaries of Franklin Resources, Inc. in connection with Franklin Resources, Inc.’s acquisition of Legg Mason, Inc. in a transaction that closed on July 31, 2020. Thornburg Investment Management, Inc. is not affiliated with Franklin Resources, Inc.

©2020 Legg Mason Investor Services, LLC. Member FINRA, SIPC. Legg Mason Investor Services, LLC is a subsidiary of Franklin Resources, Inc.

Download the White Paper