Originally posted on TheCatholicSpiritWV.org
A new tax law passed late last year could offer a great financial opportunity for parents or guardians paying Catholic school tuition or wishing to send children to Catholic school.
The law contained a provision to expand “529 accounts,” tax-advantaged savings programs formerly limited to college costs, to include K-12 expenses. 529 accounts are typically begun by parents, who name their child as the designated beneficiary, and make small investments over a long period of time.
Money invested in the account grows tax-free, as long as funds are used to pay for education expenses. Beginning in 2018, up to $10,000 in tuition at Catholic elementary and high schools is an allowable expense under both federal and most State laws. These 529 policy changes could mean more families are able to choose a Catholic education.
Before discussing the details of this opportunity and how families can use 529s, it is important to point out that 529 plans are investments and carry risk. Anyone thinking of investing in one should consult a financial advisor who can provide guidance tailored to individual situations.
How should Catholics patents take advantage of this new option supporting educational choice? Families who are already enrolled in Catholic schools or considering future enrollment, should talk to a financial advisor about opening an account to fund their tuition costs.
The expansion of 529 accounts to include K-12 expenses offers an exciting opportunity for families to access a Catholic education for their children.