SMART529 Select is a gift for you, too.
One of the main advantages SMART529 Select has over other college saving strategies is its significant tax benefits. West Virginia residents may gain income tax benefits at the Federal and West Virginia state levels,1 including:
West Virginia deduction - For West Virginia Personal Income Tax purposes, your Federal Adjusted Gross Income may be reduced by the amounts contributed to the program each year (subject to recapture if non-qualified withdrawals are made).
- Tax-deferred accumulation - Earnings in your SMART529 Select account can accumulate tax deferred.2
- Tax-free withdrawals - Withdrawals for qualified higher education expenses are free from Federal and West Virginia income taxes.3
- Annual gifting - Under the current rules, up to $18,000 per account beneficiary ($36,000 per married couple) per year may be contributed free of federal gift taxes.4The Federal Gift tax thresholds disclosed above were updated effective January 1, 2024. As this information may change periodically, please check current rules and consult with your tax professional.
- Accelerated gifting - In any year during which your 529 contributions for a particular beneficiary exceed $18,000, you may make an election on Form 709 to spread the contributions ratably over five years (20% per year) for gift-tax purposes. This permits frontloading of up to $90,000 per beneficiary (or $180,000 for a married couple) into a 529 plan without generating a taxable gift, assuming no other gifts to that beneficiary are made during the five calendar-year period. If you make the five-year election and die before the fifth calendar year, the contributions allocated to the years after your death are included in your taxable estate. 2,4,5
There are two ways to invest.
Invest directly by clicking this link or call 866-574-3542 to request an enrollment kit.
- Invest through a Financial Investment Professional
For professional guidance, investment planning assistance and additional fund options, consult with a local professional. To find a financial professional, contact a local bank or investment firm.
Additional Ways to Save
When it comes to saving for college, every contribution to the account helps. Even smaller contributions, if made regularly, can add up over time. Here are additional opportunities to help you save regularly and invite others to get involved:
Give College Savings with Ugift®
Add college savings to your wish list with Ugift, a unique service that lets you invite family and friends to celebrate special occasions with gift contributions to your beneficiary's 529 account.
You can email or print gift invitations with a Ugift coupon specially coded for your account. Your family members or friends send in their contribution (for as little as $25) with the gift coupon, and your account is credited.
Payroll Direct Deposit
Automatic payroll direct deposit makes saving for college nearly effortless. Just go online, sign up, print out the payroll direct deposit form, and bring it to your payroll department. Your employer must be able to support this feature.
1SMART529 Select is available to residents of West Virginia or to non-residents where the beneficiary is a resident of West Virginia. West Virginia (WV) provides certain tax advantages to WV taxpayers that invest in SMART529 Select. Before investing, an investor should consider whether the investor’s or designated beneficiary’s home state offers any state tax or other state benefits such as financial aid, scholarship funds, and protection from creditors that are only available for investments in such state’s 529 plan.
2Lifetime savings maximum of $550,000 per child (Effective April 1, 2022).
3Non-qualified withdrawals are taxable as ordinary income to the extent of earnings and may also be subject to a 10% federal income tax penalty. Such withdrawals may have state income tax implications.
4Any additional gifts to the same Designated Beneficiary in that five-year period would be subject to federal gift tax.
5If the donor elects to treat a gift as being made over five years, and the donor dies prior to the end of the five-year period, the portion of the gift allocatable to the period after the donor’s death will be included in the owner’s estate. Please consult your tax professional for more information.
Ugift is a registered service mark of Ascensus Broker Dealer Services, Inc.