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ABLE Act Heads to President for Approval and Signature into Law

Betty Lochner
Chair of the College Savings Plans Network & Director of Washington’s Guaranteed Education Tuition (GET) Program.
December 18, 2014

The US Senate has passed the ABLE (Achieving a Better Life Experience) Act of 2014 after this same legislation recently advanced through the US House of Representatives (see Wall Street Journal article).  Now the legislation goes to the President for his approval and is expected to be signed into law before the end of 2014. If written into law, the changes become effective for investors in 2015.

ABLE is proposed federal legislation that would allow families and individuals to save through a Federal tax-advantaged account for future qualified expenses associated with the care of a person with a disability.  Qualified expenses are those related to the individual’s disability, including health, education, housing, transportation, training, assistive technology, and personal support.

The legislation is modeled after the 529 tuition program legislation and provides similar federal income tax advantages – contributions grow tax deferred and are tax exempt when used for “qualified disability expenses.”  ABLE savings programs would need to be “established and maintained” by a state. For states that wish to offer such programs, the most effective and efficient way to do so may be to build on the infrastructure of the current 529 college savings program, or partner with another state’s program. 

The legislation also provides a significant enhancement for 529 college savings plan investors. Most notably, account owners will now be permitted to change their investment direction up to two times per year. Under the current structure, the IRS allows only one change per calendar year.  This provision is important for families who are investing in education through 529 plans and want to have more flexibility and control over their accounts.

This legislation is a huge accomplishment and has been in the works since 2011. The actions that took place today go a long way in our efforts to help American families prepare and support the future success of their children. I want to personally thank bill sponsors Rep. Ander Crenshaw (R-FL) and Senator Bob Casey (D-PA), and the 380 co-sponsors in the House and 75 co-sponsors in the Senate for their leadership.

I also want to be sure and recognize the CSPN Executive Board and Williams & Jensen, our government affairs partner, who helped with this legislation and advocated on its behalf. This is a true collaboration amongst many caring partners to see to it that all American children have the opportunity to reach their full potential. When the bill is signed into law by the President we will be sure to follow up with a formal announcement.

About the Author:
Betty Lochner is the Director of Washington’s Guaranteed Education Tuition (GET) program. Under her leadership, the GET program has grown from 7,900 to over 153,000 accounts, with a fund valued at over $2.55 billion. Washington is unique in that their only 529 plan offered is a prepaid tuition plan. Lochner currently serves as Chair of the College Savings Plans Network (CSPN).


Tax benefits can come in handy this holiday season!

Eric Zarnikow
Executive Director, Illinois Student Assistance Commission
December 15, 2014



As we approach the holidays, probably the last thing anyone wants to think about is taxes. But since 529 plans have some significant tax advantages, it’s worth having the conversation—even at this busy time of year.


In general, while contributions to a 529 plan are not deductible on your federal tax return, your investment grows tax-free, because plan benefits are exempt from state and federal taxes if used for a qualified higher education expense--including payment of tuition and fees.


The big tax savings on 529 plans can come at the state level. In addition to tax-free plan earnings for benefits paid for education, many states offer tax deductions or matching contribution benefits, although the amount of the tax deduction for contributions varies by state. My home state of Illinois, for example, is just one of the states with a generous tax deduction. It’s important to note that to take a state tax deduction in the current year, the account owner must actually make the contribution in the current year.  In some states, anyone who contributes to a 529 plan can take a deduction not just the owner of the account. It’s important to check with your state and/or tax professional to see what kind of plans and tax benefits might be available, and the parameters for taking any deductions.


While it’s hard to wrap neatly with a bow, a nice tax deduction can be a pretty good holiday gift for you and your family!


Note: This information is offered for educational purposes only and is not intended to provide legal, tax or investment advice as individual tax situations may vary.


About Author
Eric Zarnikow is Executive Director of the Illinois Student Assistance Commission (ISAC), a state agency focused on making college more accessible and affordable for Illinois families. ISAC administers the College Illinois! 529 prepaid tuition plan, in addition to engaging in college outreach across the state and administering over $380 million in scholarships and grants. Zarnikow is a certified public accountant and holds an MBA from Drake University.

Give the Gift of Education


Buffy Kuiper,
Senior Program Specialist

The holidays are fast approaching and the town is hustling and bustling with people frantically trying to find the best gifts and deals. With all the “this deal’s for you” noise, how can college savings plans across the country promote the idea of making a gift to a loved one’s college savings account?

Do all of our friends have college savings plans? Sadly, most don’t.  Would the promise of a contribution incentivize a family to open an account? Maybe, maybe not. Is this what parents want and prefer? How can one incorporate the idea of making a child’s college dream a reality this holiday season? It’s not about the amount; it’s about taking action and setting an expectation while changing the mindset from “if” to “when I go to college…” Who wouldn’t want a child to have a bright future?

The Most Wonderful Time of the Year?

By Sandra Houston
Director of College Illinois! Prepaid Tuition Program
December 1, 2014

My family and I have created special holiday traditions and memories that will last a lifetime. One of my favorite traditions is working on crafts with the children in the family. I still treasure the lopsided snowflakes, tissue paper wreaths and handmade gifts. Amidst the glitter, glue, crayons and giggles, wonderful memories were made. Although my nephew is now in graduate school, the Christmas ornament he made when he was seven years old is still proudly displayed on our Christmas tree each year --much to my nephew’s embarrassment.

Thanksgiving: A Great Time to Recognize the Education Pilgrims in Our Lives!

By Ryan Betz
Associate Director of Marketing & Communications

Washington’s GET Program
Nov. 24, 2014

Ryan Betz, left, with his father.
On May 9, 1998, I was the first person in my family to graduate from college. This was not a fluke, it was an intentional goal set by my parents the day I was born. Neither my mom nor my dad had the opportunity to pursue a degree. 

My mom is a self-taught computer programmer who became independent at the age of 16 and worked full-time while finishing high school. My dad is the son of a farmer from Iowa who was captured while building runways in Japan during WWII. He was held as a prisoner of war for close to six years. Because my grandfather’s health was not the best after the war, my dad also worked through high school to support his family and when he graduated, college was not an option. 

Prepaid Conference Hits the Jackpot!

By Betsy Hagen
Associate Director for GET Operations
Nov. 20, 2014

Betty Lochner, center, with CSPN Prepaid Co-chairs, Sheila Salehian, left, and Robin Lott, right, at the Prepaid conference.
I just got back from Vegas and the best part is that the old adage, “What happens in Vegas stays in Vegas,” doesn’t apply to this situation. I’m excited to tell you all about the very first Prepaid Tuition Conference!

Sheila Salehian, Senior Deputy Treasurer at the Office of Nevada State Treasurer, welcomed attendees at the first prepaid tuition conference Friday, November 14, in Las Vegas. Salehian and her team graciously hosted the event, which was packed with timely and informative sessions.

Inspiration and Education as Holiday Gifts: Why Not?

By Patricia Roberts
Managing Director
AllianceBernstein Investments
Nov. 17, 2014

I recently returned inspired in so many ways from the College Board 2014 Forum.  I was particularly moved by the FirstGen Student Panel moderated by John QuiƱones of ABC News. Like John, these amazing students were the first in their families to attend college. They spoke of their challenging and courageous journeys to and through higher education and the positive impact college is having on them and on those whose lives they touch. The combination of John’s own powerful story and theirs presented a valuable reminder of the vital role that education plays in opening doors and the many rewards that perseverance brings.

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