family college savings
program
DP |
Committee on Education |
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dp |
Committee on Ways and Means |
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dp |
Caucus and COW |
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dp |
Third Read |
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x |
As Passed the House |
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HB 2098 conforms the Arizona Family College Savings Program (Program) to comply with new federal laws passed as part of the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) signed by President Bush on June 7th, 2001.
The Program is the state's IRS Code, Section 529 approved savings plan
designed to encourage adults to save for the future education expenses of young
people. The Arizona Commission for Postsecondary Education is the non-profit
state agency that is required to oversee the program.
Any person, including parents, grandparents, uncles, aunts or friends,
who choose to save for the qualified higher education expenses of another
person may open an account. Once an
account is established, anyone can contribute to that account.
Any person interested in pursuing post high school training and
educational opportunities may be designated as a beneficiary of an account. Each
account can have only one designated beneficiary, and a one-time application fee of $10 will be applied to
each new account. Account holders will be able to contribute to a designated
fund with deferment of federal income taxes on investment earnings. Designated
beneficiaries who are Arizona residents, are exempt from state taxation when used
to pay qualified higher education expenses of the designated beneficiary.
Funds can be used to enroll in and graduate from higher
education institutions anywhere in the country. This includes two-year and
four-year public or private colleges, universities, community colleges or
technical training schools. A school must be accredited by a national
accrediting agency that is recognized by the U.S. Department of Education and
meet the federal requirements to participate in federal student aid programs. The program is designed to pay for qualified
postsecondary education expenses, including tuition, fees, supplies, room and
board, equipment and books.