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ERIC Number: ED279246
Record Type: Non-Journal
Publication Date: 1986-Dec
Reference Count: N/A
The Suitability of Tax-Exempt Tuition Investment Plans for Illinois Higher Education.
Illinois State Board of Higher Education, Springfield.
The suitability of tax-exempt tuition investment programs to help parents meet college costs is analyzed, with attention to proposed and existing tuition investment plans, other options, organizational and administrative issues, and tax issues. Tuition prepayment plans allow parents to make investments on a sliding scale according to the child's age in order to lessen the effects of future tuition inflation. Under some plans, parents can avoid paying taxes on dividends. Prepayments can also be used to guarantee no tuition increase for 4 years. Proposed state operated plans for Michigan, Wisconsin, and New Jersey are described, along with plans now offered by seven private colleges. Other means of financing tuition are also briefly considered: loan programs, education savings accounts, index tuition/standard tuition unit plan, and commercial plans. Six elements for designing a plan are examined, including the type of agreement, administrative structure, and options for withdrawal of benefits. Advantages/disadvantages of a tuition investment program for the state and for the family are identified. Appendices include a copy of the relevant legislation, Illinois Senate Resolution 782. (SW)
Descriptors: Case Studies, Financial Services, Higher Education, Inflation (Economics), Investment, Private Colleges, State Programs, Student Costs, Tax Deductions, Tuition
Illinois Board of Higher Education, 500 Reisch Building, 4 W. Old Capitol Street, Springfield, IL 62701.
Publication Type: Reports - Descriptive
Education Level: N/A
Authoring Institution: Illinois State Board of Higher Education, Springfield.
Identifiers - Location: Illinois