Contributing to an Account

Can Funds Be Transferred From Another 529-Qualified Tuition Program?

You may fund an account in the program by transferring funds from another 529-qualified tuition program. The rollover transaction will be treated as an income tax-free qualified rollover distribution if the beneficiary is unchanged or changed to a member of the current beneficiary’s family and if the rollover does not occur within 12 months from the date of any previous rollover to a 529-qualified tuition program for that beneficiary.

The program from which you are transferring funds may impose fees or other restrictions on the transfer, so investigate this option thoroughly before requesting a transfer. When transferring funds from another 529-qualified tuition program, the Internal Revenue Service requires the program manager to assume that the transfer consists solely of earnings until it receives a statement identifying the contributions and earnings portions of the distribution. See Exhibit B – Tax Information in the Program Disclosure Statement.

Investment Products: Not FDIC Insured. No Bank Guarantee. May Lose Value

The Bright Directions College Savings Program is part of the Illinois College Savings Pool and is designed to qualify as a qualified tuition program under the provisions of Section 529 of the Internal Revenue Code. The Bright Directions College Savings Program is sponsored by the State of Illinois and administered by the Illinois State Treasurer, as Trustee. Union Bank & Trust Company serves as Program Manager, and Northern Trust Securities, Inc. acts as Distributor.

You should be aware that other states may sponsor their own qualified tuition plans and may offer a state tax deduction or other benefits that are limited to residents who invest in that plan. You should consult with a tax advisor about state and local taxes.

Withdrawals used to pay for qualified higher education expenses are income TAX-FREE (Federal and State of Illinois). Qualified higher education expenses include tuition, fees, books, supplies and equipment required for enrollment at a qualified institution of higher education. Room and board is considered a qualified higher education expense if the student is enrolled on at least a half time basis.

Every individual's tax situation is different, and it is important to consult a qualified tax advisor regarding the application of the Program’s benefits to your own individual situation.

There is no guarantee that any investment portfolio will achieve its investment goals. The value of an account will go up or down based on the performance of the Portfolio in which the account is invested. When funds are withdrawn, they may have more or less than the total contributions made to the account. Past investment performance is no guarantee of future results.

Investments in the Bright Directions College Savings Program are not guaranteed or insured by the State of Illinois, the Illinois State Treasurer, Union Bank & Trust Company, Northern Trust Securities, Inc., the Federal Deposit Insurance Corporation or any other entity. Investors should read carefully and consider the investment objectives, risks, fees, and expenses contained in the Program Disclosure Statement (issuer's official statement) before investing. The Program Disclosure Statement, which contains additional information about the plan and municipal fund securities, is available from your financial advisor.