Bright Start 529 Plan Help Center

Featured Topic Questions

Illinois Tax Benefit Questions

 
    • December 31, 2019 is the contribution deadline
    • Account Owner can make 2019 contributions via their secure online access until 11:59 PM Central Standard Time on December 31st
    • Contributions by mail must have a 2019 postmark to qualify for the 2019 state income tax deduction

    • Individuals can deduct up to $10,000 of their contributions each year
    • Contributors who are married and filing jointly can deduct up to $20,000 of their contributions each year
    • The contributions portion of a rollover from an out-of-state 529 program can be deducted up to the $10,000 individual or $20,000 joint limits if the rollover is completed in 2019. The earnings portion of the rollover is not eligible for the deduction.

    • It is our understanding that any Illinois taxpayer can contribute to an Illinois 529 plan by December 31st to take advantage of the state income tax deduction

    • The contributions portion of a rollover from an out-of-state 529 program can be deducted up to the $10,000 individual or $20,000 joint limits if the rollover is completed in 2019. The earnings portion of the rollover is not eligible for the deduction.
    • An Account Owner can request a rollover once every 12 months or upon the change of the account Beneficiary.
    • The rollover check from the out-of-state 529 program must be postmarked in 2019 to qualify as a 2019 rollover contribution.
    • The rollover process can take 2-4 weeks to complete, depending on how quickly the out-of-state 529 program processes the distribution and issues a check. If no other rollovers have been completed in the last 12 months, we recommend requesting a rollover as soon as possible.
    • To request a rollover, the Account Owner must complete and submit the Rollover Form to Bright Start. We will coordinate the rollover with the out-of-state 529 program.
    We recommend reaching out to the out-of-state 529 program determine if there are any fees or penalties for requesting a rollover out of the plan. You should also ask if there are any special requirements to complete a rollover, including whether they require a Medallion Signature Guarantee stamp on the Rollover form.

Common Questions

Account Information

 
    • The Account Owner can request a change of beneficiary at any time to a family member of the current beneficiary (i.e. sibling, first cousin, etc). To request a change of beneficiary, the Account Owner should complete the Change of Beneficiary form. The form can be faxed to us at 402.323.1797 or mailed to the address at the top of the form.

    • You can transfer funds between accounts for related beneficiaries at any time. To request a transfer, we ask that you complete and submit the Fund Transfer form. The form can be faxed to us at 402.323.1797 or mailed to the address at the top of the form.

    • For security reasons, we place a withdrawal restriction on accounts established online. We would be happy to assist after verifying some of your account information over the phone. Once we speak to the Account Owner to confirm account information, we are able to remove the restriction. The Account Owner can then request withdrawals online.
    • The Account Owner can reach our Customer Care Center at 877.432.7444 from 7 AM to 7 PM Central Standard Time, Monday through Friday.

    • When the Account Owner is ready to request a withdrawal from an account they have several options:
      • Log into your account online and select “Withdraw” to walk through the simple steps.
      • Complete and submit the Withdrawal Request Form
      • Contact us at 877-432-7444 to request the withdrawal over the phone.
    • Qualified college expenses from a 529 account currently include the following:
      • Tuition
      • Fees
      • Books
      • Supplies
      • Equipment required for enrollment
      • Computer and computer-related expenses
      • Certain room and board expenses (if the student is enrolled at least half-time)
    • We can issue a check to the Account Owner, to the Beneficiary, or directly to the school, or can send funds to an appropriately authorized bank account on file. It is our understanding that withdrawals and expenses should match in the same calendar year. We recommend keeping all receipts, invoices or other documentation in the event of questions or an audit in the future.
    • K-12 Expenses
      Federal law, but not Illinois law, permits an aggregate of up to $10,000 during a taxable year from all 529 qualified tuition programs for a Beneficiary to be used for tuition or connection with the Beneficiary’s enrollment or attendance at an elementary or secondary public, private or religious school. Such a distribution would be an Illinois Nonqualified Distribution and the amount of any deduction previously taken for Illinois income tax purposes (or a portion of such amount) would be added back to Illinois taxable income. Consult with your tax or legal advisor before making such distributions.

    • The Account Owner should complete and submit an Update form. The form should be mailed to Bright Start (address at the top of the form) with the accompanying legal documentation reflecting the change.
    • The Account Owner can reach our Customer Care Center at 877.432.7444 from 7 AM to 7 PM Central Standard Time, Monday through Friday.


  • To find more answers to some common questions about Bright Start 529 Plans, visit our FAQ page.