How much will college cost?

With your MNSAVES account, you're not locked in. You’ll always have access to several options for this money:

• Your funds can be used to pay for a variety of eligible education expenses, including at any accredited college, university, apprenticeships, community or technical college and postgraduate program in the United States—and even some schools abroad.¹
• Your 529 can be used for student loan repayment up a $10,000 lifetime limit per individual.¹
• Pay for K-12 qualified expenses - up to $20,000 annually can be used per student at a public, private, or religious elementary, middle, or high school. Qualified education expenses include curriculum, instructional materials, tutoring by approved professionals, standardized test and dual enrollment fees, and licensed educational therapies for students with disabilities.¹
• Pay for qualified expenses when enrolled in a recognized postsecondary credentialing program.²
• You can transfer the funds to another eligible beneficiary, such as another child, a grandchild or yourself.
• If you just want the money back, you can withdraw the funds at any time. If funds are withdrawn for a purpose other than qualified higher education expenses, the earnings portion of the withdrawal is subject to federal and state taxes plus a 10% additional federal tax on earnings (known as the “Additional Tax”). See the Plan Description for more information and exceptions.
• Or you can always wait because the funds never expire, and often the choice to go to school is a delayed decision. So, if your child changes their mind down the road, your account will still be available.
• Account owners may roll money from a MNSAVES account to a Roth IRA for the benefit of the 529 plan account beneficiary without incurring federal income tax or penalties (state tax treatment varies). For the rollover to be treated as a non-taxable event, certain conditions apply as referenced in Am I eligible to rollover funds from my 529 plan account to a Roth IRA?³

Footnotes

1. ¹Withdrawals for tuition expenses at a public, private or religious elementary, middle or high school, registered apprenticeship programs and student loans can be withdrawn free from federal taxes. For Minnesota taxpayers, these withdrawals are subject to recapture of tax deduction/credit, state income tax as well as penalties. You should talk to a qualified professional about how tax provisions affect your circumstances. Apprenticeship programs must be registered and certified with the Secretary of Labor under the National Apprenticeship Act.↩
2. ²Withdrawals for recognized postsecondary credentialing—including tuition, books, equipment, supplies, as well as testing fees for continuing education and therapies for students with disabilities—are exempt from federal income tax. For Minnesota taxpayers these withdrawals are subject to recapture of Minnesota state income tax on the earnings and Minnesota’s recapture provisions for previously deducted or credited contribution amounts. Consult a tax professional for guidance.↩
3. ³The TIAA group of companies and the Minnesota 529 College Savings Plan do not provide legal or tax advice. Please consult your tax or legal advisor to address your specific circumstances.↩

Your contributions will always be yours, and you do not need to be a resident of Minnesota to open, contribute to or use a MNSAVES account. Your MNSAVES account can also be used for a range of qualified expenses in state, out of state and abroad. If you move to another state, you can keep your money invested and continue making contributions to your MNSAVES account—no problem!

Good news, no, your MNSAVES funds can be used at any accredited university in the country-and even some abroad. This includes public and private colleges and universities, community and technical colleges, graduate schools and professional schools, and certain apprenticeships or credentialing programs. Further, up to $20,000 annually can be used toward K-12 expenses (per student), student loan repayment up to a $10,000 lifetime limit per individual, or unused funds can be rolled over to a Roth IRA for the beneficiary.¹

Footnotes

1. ¹K-12 (primary or secondary school) withdrawals are limited to $20,000 per year. Apprenticeship programs must be registered and certified with the Secretary of Labor under the National Apprenticeship Act. Student loan repayment subject to a lifetime limit of $10,000 per individual when using a 529 plan. For Minnesota taxpayers, these withdrawals are subject to Minnesota state income tax on the earnings and Minnesota's recapturing provisions for previously deducted or credited contribution amounts. You should talk to a qualified professional about how tax provisions affect your circumstances.
   
   Rollovers from a 529 plan account to a Roth IRA that do not incur federal income tax should also be free from Minnesota state income tax except to the extent of Minnesota’s recapture provisions for previously deducted or credited contribution amounts. Account Owners and Beneficiaries should consult with a qualified tax professional before rolling over funds from their 529 plan to contribute to a Roth IRA.↩

Qualified higher education expenses include tuition, certain housing and food expenses, fees, books, supplies and equipment required for the enrollment and attendance of the beneficiary at an eligible educational institution. This includes most postsecondary institutions. When used primarily by the beneficiary enrolled at an eligible educational institution, computers and related technology such as internet access fees, software or printers are also considered qualified higher education expenses.

Qualified higher education expenses also include certain additional enrollment and attendance costs at eligible educational institutions for any beneficiary with special needs.

Qualified higher education expenses also include (a) expenses in connection with enrollment or attendance at a K-12 primary or secondary public, private or religious school up to a maximum of $20,000 of distributions per taxable year per beneficiary from all Section 529 programs); (b) expenses for fees, books, supplies and equipment required for the participation of a beneficiary in a certified apprenticeship program2; and (c) qualified expenses related to enrollment in a recognized postsecondary credentialing program; and, (d) amounts paid as principal or interest on any qualified education loan of either the beneficiary or a sibling of the beneficiary (up to a lifetime limit of $10,000 per individual). Review the Plan Description for additional information, including the state tax treatment of withdrawals for these expenses.¹

Footnotes

1. ¹Withdrawals for tuition expenses at a public, private or religious elementary, middle or high school, and withdrawals for Recognized Postsecondary Credentialing Programs—including tuition, books, equipment, supplies for the enrollment or attendance, testing fees if required to obtain or maintain a Recognized Postsecondary Credential, fees for continuing education if required to maintain an RP Credential and therapies for students with disabilities—can be withdrawn free from federal taxes. For Minnesota taxpayers, these withdrawals are subject to recapture of tax deduction/credit, state income tax as well as penalties. Withdrawals for Apprenticeship Expenses, or Qualified Education Loan Repayment that are not subject to federal income tax should also be free from Minnesota state income tax except to the extent of Minnesota’s recapture provisions for previously deducted or credited contribution amounts. You should talk to a qualified professional about how tax provisions affect your circumstances.↩