Using Equity Compensation to Fund Education Expenses
With the soaring costs of education, many parents are facing sticker shock when it comes to planning for their children's future. It's never too early to start planning for this important financial goal. Remember to consider how all your income sources can contribute. One often overlooked source is equity compensation. Watch the video to learn more.
Using Equity Compensation to Fund Education Expenses
With the soaring costs of education, many parents are facing sticker shock when it comes to planning for their children's future. It's never too early to start planning for this important financial goal. Remember to consider how all your income sources can contribute. One often overlooked source is equity compensation. Watch the video to learn more.
If an account owner or the beneficiary resides in or pays income taxes to a state that offers its own 529 college savings or pre-paid tuition plan (an “In-State Plan”), that state may offer state or local tax benefits. These tax benefits may include deductible contributions, deferral of taxes on earnings and/or tax-free withdrawals. In addition, some states waive or discount fees or offer other benefits for state residents or taxpayers who participate in the In-State Plan. An account owner may be denied any or all state or local tax benefits or expense reductions by investing in another state’s plan (an “Out-of-State Plan”). In addition, an account owner’s state or locality may seek to recover the value of tax benefits (by assessing income or penalty taxes) should an account owner rollover or transfer assets from an In-State Plan to an Out-of-State Plan. While state and local tax consequences and plan expenses are not the only factors to consider when investing in a 529 Plan, they are important to an account owner’s investment return and should be taken into account when selecting a 529 plan.
Tax laws are complex and are subject to change. This information is based upon current tax rules in effect at the time this was written. Morgan Stanley Smith Barney LLC and its Financial Advisors do not provide tax or legal advice. Individuals should always check with their tax or legal advisor before engaging in any transaction involving 529 Plans, Education Savings Accounts and other tax-advantaged investments.
Investments in a 529 Plan are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so an individual may lose money.
Investors should review a Program Disclosure Statement, which contains more information on investment options, investment objectives, risks factors, fees and expenses and possible tax consequences. Investors should read the Program Disclosure Statement carefully before investing.
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