Tomorrow’s opportunities come from saving today. That’s why you’re setting money aside for higher education in the years to come. And with an investment in Bright Directions, you can enjoy several additional benefits today: tax advantages, flexibility, competitive plan costs, and investment options from quality fund families.
1Withdrawals used to pay for Qualified Higher Education Costs are free from federal and Illinois state income tax. Qualified higher education expenses include tuition, fees, books, supplies, and equipment required for enrollment or attendance; certain room and board expenses incurred by students who are enrolled at least half-time; the purchase of computer or peripheral equipment, computer software, or Internet access and related services, if used primarily by the beneficiary during any of the years the beneficiary is enrolled at an eligible educational institution; and certain expenses for special needs services needed by a special needs beneficiary. Important Note: If the money is used for other purposes, the earnings portion of the withdrawal is subject to federal income tax as well as any state income tax and may be subject to a 10% federal tax penalty.
2An individual who files an individual Illinois state income tax return will be able to deduct up to $10,000 per tax year (up to $20,000 for married taxpayers filing a joint Illinois state income tax return) for their total, combined contributions to the Bright Directions College Savings Program, the Bright Start College Savings Program, and CollegeIllinois! during that tax year. The $10,000 (individual) and $20,000 (joint) limit on deductions will apply to total contributions made without regard to whether the contributions are made to a single account or more than one account. The amount of any deduction previously taken for Illinois income tax purposes is added back to Illinois taxable income in the event an Account Owner takes a Nonqualified Withdrawal from an Account or if such assets are rolled over to a non-Illinois 529 plan. If Illinois tax rates have increased since the original contribution, the additional tax liability may exceed the tax savings from the deduction.
All portfolios benefit from the investment oversight of Wilshire Associates, a leading global investment consulting firm that provides Bright Directions with portfolio design, due diligence, and ongoing monitoring services. Wilshire Associates originated the now-named Dow Jones Wilshire 5000SM Composite Index and other market indexes and has been helping individuals achieve their investment goals for more than 30 years.
The Bright Directions College Savings Program makes it easy for friends and family to help give the gift of a college education. Parents, grandparents, and others can make a gift to the beneficiary to celebrate birthdays and special occasions.