529 a smart college savings plan
Released July 2004

       When I became state treasurer in January of 1997, it was obvious we had to continue the core functions of the office. The treasurer’s office is the state’s bank – it holds all revenues and pays all bills.
        We felt confident we would fulfill the basics, but didn’t want to stop there. Among my goals was improving the treasury’s unclaimed property program; implementing e-government, which allows residents to do business with government electronically; and the establishment of a college savings plan program.
        We’ve been doing some good things with our college savings programs lately. We want you to get in on the action.
        Ordinary folks like you and me contribute to the fund, which is invested by The Hartford financial services firm under certain conditions mandated by a state board of trustees. I serve as chairman of that board.
        Our SMART529 program earned “five-cap” ratings from the web site Savingforcollege.com. That site is the most commonly referenced national source for college savings advice. A five-cap is its highest rating.
        We have seen our account numbers jump from 15,000 accounts valued at $87 million to more than 35,000 accounts checking in at $282 million. With The Hartford’s help, we have tailored a program that, by all accounts, has been a success.
        Now the challenge is to inform people about the many advantages of 529 programs, specifically ours.
        All it takes is $100 to open an account. Subsequent contributions can be as little as $15 and need not be made on a set schedule. We do certainly encourage regular investing, however. Each person with an account in his or her name may accrue as much as $265,620 in tax-free funds for college tuition, fees, room, board, books and supplies.
        That money is tax free when it is withdrawn for educational use. Regular contributions, year-by-year, to the official state-sponsored plan also reduces a resident’s adjusted gross income when it comes time to calculate state income tax.
        This is an important distinction, for other 529 plans – so named for a section of IRS tax code – do not allow a West Virginia contributor to claim such an exemption.
        Say, for instance, you’re ready to write a $2,000 check for your child’s tuition. It makes much more sense to contribute that same amount to a SMART529 account then deduct the amount, dollar for dollar, on your West Virginia gross income for tax reporting. SMART529 then writes the $2,000 check.
        Sure, we’re proud of what we’ve been able to accomplish with SMART529. But we’re not here merely to beat our chests.
        We want the proud ones to be you, the hard-working taxpayer, at having made a wise decision with your child’s future.