Achieve Montana is a 529 plan administered by the Montana Board of Regents of Higher Education (the trustee of the Montana Family Education Savings Trust). Achieve Montana offers special advantages including: tax-deferred growth, generous contribution limits, and professional investment management.
When you enroll in Achieve Montana, you choose to invest in one or more of seven different Investment Options, including the Age-Based Option and six Individual Portfolios, based upon your investing preferences, time horizon and risk tolerance. All of the contributions made to your Account grow tax deferred and distributions are free from federal and state income tax if used for Qualified Expenses.1
The easiest way is to enroll online. It only takes about 10 minutes. If you prefer to enroll by mail, complete the Enrollment Form and make an initial investment for the benefit of an individual (the beneficiary). You must open a separate account for each beneficiary.
It only takes $25 to open an account (by check or electronic funds transfer), or $15 with payroll direct deposit if your employer offers that benefit. You can also make regular monthly, quarterly, semi-annual, or annual contributions (minimum of $25 per month) from your checking or savings account with an Automatic Investment Plan (AIP).2
The total balance of all accounts within Achieve Montana for the same beneficiary cannot exceed $396,000.
A U.S. citizen or resident alien, 18 or older, or an entity that is organized in the U.S., with a Social Security number or Tax Identification number and a valid, permanent residential U.S. address can open an Achieve Montana account, regardless of income level. Parents, grandparents, other family members, and friends can open an account for any person they choose. You can also open an account to pay for your own higher education.
Any number of people can contribute to the same Achieve Montana account, but total contributions cannot exceed $396,000 for all accounts for the same beneficiary in 529 plans sponsored by the State of Montana. This includes any funds held for the same beneficiary in the Montana Family Education Savings Program Bank Plan which is closed to new investments but continues to administer existing Bank Plan accounts.
Any person of any age with a Social Security number or Tax Identification number can be named as the beneficiary of an Achieve Montana account. As the account owner, you can select a child, adult or even yourself as beneficiary. If your beneficiary decides not to attend college or another qualified post-secondary institution, you can name another beneficiary who is a qualified member of the same family as the original beneficiary without incurring any penalties. Please see the Achieve Montana Program Description for more information on who qualifies.
Yes. As the account owner, you choose the portfolios in which you invest, as well as the distribution of the funds.
Yes. You can change the direction of your future contributions at any time. Federal law permits you to move your current assets in your Achieve Montana account to a different mix of investment options up to two times per calendar year.
Yes. You can transfer your account to a "member of the family" of the beneficiary without incurring federal income tax or penalties.3
Yes. You may change your investment options up to two times per calendar year per beneficiary. If you have multiple investment options for a beneficiary, all changes for the calendar year for that beneficiary must be requested on the same day. For more information on making changes to your Account, see the Program Description.
Except to the extent of the New York Life Insurance Company guarantee that is available for the Capital Preservation Portfolio, investment returns are not guaranteed, and you could lose money by investing in Achieve Montana. For additional information, please refer to the Achieve Montana Porgram Description.
Achieve Montana has no commissions, loads, or sales charges. The total annual asset-based fee ranges from 0.47% to 0.83% (depending on which investments you choose). In addition, an Annual Account Maintenance Fee of $25 is charged to each account. This fee is waived if you are a Montana resident, use an AIP, take advantage of payroll deduction through your employer, or maintain an account balance equal to or greater than $25,000.
Ugift is an innovative online feature that allows you to invite family and friends to celebrate special occasions with gift contributions to your Achieve Montana account. To learn more, click here.
Upromise is a free to join rewards program that can turn every day purchases -- from shopping online to dining out, from booking travel to buying groceries -- into cash back for college. A percentage of your eligible spending will be deposited into your Upromise account. You can link your Upromise account to your eligible 529 account and have your college savings automatically transferred. Visit Upromise.com/Montana to learn more and enroll4.
529 plan assets are counted at different rates for the Expected Family Contribution (EFC) in the FAFSA formula. As of July 1, 2009, federal guidelines are as follows:
Note: Financial aid programs offered by educational institutions and other non-federal sources may have their own guidelines for the treatment of 529 plan accounts. For complete information about financial aid eligibility, you should consult with a financial aid professional and/or the state or educational institution offering a particular financial aid program, since rules and regulations often change.
1 Earnings on non-qualified withdrawals are subject to federal income tax and may be subject to a 10% federal penalty tax, as well as state and local income taxes. The availability of tax or other benefits may be contingent on meeting other requirements. See the Program Description for more details on qualified expenses.
2 A plan of regular investment cannot assure a profit or protect against a loss in a declining market.
3 Section 529 defines a member of the family of the beneficiary as an individual who is related to the beneficiary as follows: a son, daughter, stepchild, or a descendant of any such person; a brother, sister, stepbrother, or stepsister; the father or mother, or an ancestor of either; a stepfather or stepmother; a son or daughter of a brother or sister; a brother or sister of the father or mother; a son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-law; the spouse of the beneficiary or the spouse of any individual described above; or a first cousin of the beneficiary. Gift or generation-skipping transfer taxes may apply. Please consult with your tax advisor for further information.
4 Upromise is an optional service offered by Upromise, Inc., is separate from Achieve Montana, and is not affiliated with the State of Montana. Terms and conditions apply to the Upromise service. Participating companies, contribution levels, and terms and conditions are subject to change at any time without notice. Transfers from Upromise to an Achieve Montana account are subject to a $25 minimum.
Earnings grow tax deferred and are free from federal taxes when used for qualified higher education expenses.1 Qualified higher education expenses include tuition, mandatory fees, books, supplies, and equipment required for enrollment or attendance; certain room and board costs during an academic period the beneficiary is enrolled at least half-time; and certain expenses for a special-needs student.
Yes. Contributions you make to an Achieve Montana account may be eligible as a yearly deduction to adjusted gross income of up to $3,000 per taxpayer per year ($6,000 for those married, filing jointly), in computing Montana state income tax3.
Read more about Montana taxpayers.
Individuals can invest up to $15,000 ($30,000 for married couples making a proper election) per beneficiary without incurring any federal gift-tax consequences provided you don't make additional gifts to that beneficiary in the same year. In addition, "accelerated gifting" lets you contribute up to $75,000 per beneficiary in a single year ($150,000 for married couples making a proper election) and take advantage of five years' worth of tax-free gifts at one time provided you don't make additional gifts to that beneficiary for five years (Contributions are considered completed gifts to the beneficiary and are removed from your estate2, but you, as the account owner, retain control.) For more information, consult your tax advisor or estate-planning attorney.
1 Earnings on non-qualified withdrawals are subject to federal income tax and may be subject to a 10% federal penalty tax, as well as state and local income taxes. The availability of tax or other benefits may be contingent on meeting other requirements. See the Program Description for more details on qualified expenses.
2 In the event the donor does not survive the five-year period, a pro-rated amount will revert to the donor's taxable estate.
3 Contributions to an Achieve Montana account owned by the taxpayer, the taxpayer's spouse or the taxpayer's child or stepchild (if the child or stepchild is a Montana resident at the time of the contribution) are deductible in computing Montana adjusted gross income for the tax year in which they are made. Contributions may be subject to recapture in certain circumstances, such as a non-qualified withdrawal or a withdrawal or distribution from an account that was opened within three years prior to the date of the withdrawal or distribution (Recaptured Withdrawal). If the account owner is no longer a Montana resident at the time of a Recaptured Withdrawal, the Program Manager or its service provider may withhold the potential recapture tax from a Recaptured Withdrawal.
The money in your Achieve Montana account can be used for any purpose. However, to qualify for federal and Montana state tax-free withdrawals on earnings and avoid penalties, the money must be used for qualified higher education expenses for the beneficiary at an eligible educational institution.1, 2
Eligible expenses can include tuition, mandatory fees, books, supplies, and equipment required for enrollment or attendance; certain room and board costs during any academic period the beneficiary is enrolled at least half-time; and certain expenses for a special-needs student.1
No. Repayment of student loans is not considered a qualified higher education expense.
No. You can use the assets in your account toward the costs of nearly any public or private, 2-year or 4-year college nationwide, as long as the student is enrolled in a U.S.-accredited college, university, graduate school, or technical school that is eligible to participate in U.S. Department of Education student financial aid programs.2 In fact, many U.S. colleges and universities now have campuses or locations outside of the country, where money from your account can be used.
Achieve Montana does not require a child to attend college immediately after graduating high school. There are no restrictions on when you can use your account to pay for college expenses.
If a beneficiary decides not to attend college, you have the following options.
Additionally, any accumulated earnings that are withdrawn from your account must also be reported on the recipient's income tax return for the year in which they are withdrawn. Contact your tax advisor to determine how to report a non-qualified withdrawal.
1 Earnings on non-qualified withdrawals are subject to federal income tax and may be subject to a 10% federal penalty tax, as well as state and local income taxes. The availability of tax or other benefits may be contingent on meeting other requirements.
2 An eligible educational institution is a post-secondary institution that is eligible to participate in a student aid program administered by the U.S. Department of Education.
3 Section 529 defines a member of the family of the beneficiary as an individual who is related to the beneficiary as follows: a son, daughter, stepchild, or a descendant of any such person; a brother, sister, stepbrother, or stepsister; the father or mother, or an ancestor of either; a stepfather or stepmother; a son or daughter of a brother or sister; a brother or sister of the father or mother; a son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-law; the spouse of the beneficiary or the spouse of any individual described above; or a first cousin of the beneficiary. Gift or generation-skipping transfer taxes may apply. Please consult with your tax advisor for further information.
4 Contributions to an Achieve Montana account owned by the taxpayer, the taxpayer' s spouse or the taxpayer's child or stepchild (if the child or stepchild is a Montana resident at the time of the contribution) are deductible in computing Montana adjusted gross income for the tax year in which they are made. Contributions may be subject to recapture in certain circumstances, such as a non-qualified withdrawal or a withdrawal or distribution from an account that was opened within three years prior to the date of the withdrawal or distribution (Recaptured Withdrawal). If the account owner is no longer a Montana resident at the time of a Recaptured Withdrawal, the Program Manager or its service provider may withhold the potential recapture tax from a Recaptured Withdrawal.
