FREQUENTLY ASKED QUESTIONS

It's a simple, affordable way for families to put aside money for college tuition and education-related expenses. The "529" refers to the section of the Internal Revenue Code that allows these plans.

It's a 529 plan offered by the Education Trust of Alaska and managed by the investment firm of T. Rowe Price.

• A low minimum investment (you can start with as little as $50)
• Any earnings are tax-deferred
• Money withdrawn for qualified educational expenses is free from federal taxes
• As the account holder, you control how and when the money is used
• A variety of investment options
• Low cost, with no load or commissions
• Gift and Estate Tax benefits
• Professional investment management by T. Rowe Price
• No income restrictions

Any U.S. citizen or resident alien can open an account, and so can trusts, corporations, and other organizations. There are no income limitations or age restrictions.

You can complete your application online anytime. Just click here to get started now. You can also download the forms, complete them, and mail them to us. Or you can request a kit be mailed to you. And you can call us at 1-866-277-1005 for help.

You can start with as little as $50 if you use our monthly Automatic Asset Builder program. If you're starting with a one-time purchase, the minimum contribution requirement is $250.

Only one person - referred to as the account holder - can open and control an account. If the account holder is a minor, a custodian must act on the minor's behalf. Each account may have only one beneficiary (future student), but you can open as many accounts for as many beneficiaries as you want.

Any U.S. citizen or resident alien, including the account holder, can be a beneficiary. The beneficiary must be an individual, not a trust or corporation. There are no income limitations or age restrictions. In fact, if you're thinking of going back to school, you can even open an account for yourself!

That answer varies from school to school. Typically, 529 plans aren't treated as an asset of the student's. Any investments, however, may affect eligibility for need-based aid. Check with the schools you're considering to learn what their guidelines are.

Our eight enrollment-based portfolios are targeted to the expected college enrollment date of the beneficiary. These portfolios have more exposure to equities when the beneficiary is young and shift automatically to more conservative allocations as he or she approaches college age. Assets are moved to the Portfolio for College in the year corresponding to the name of the portfolio. For example, Portfolio 2021 moves to the Portfolio for College in the year 2021.

This balanced portfolio offers many special benefits. It has a UA Tuition-Value Guarantee, which locks in UA tuition value. If you invest in this portfolio, each contribution you make locks in tuition credits for future use at UA. In addition, the annual program and maintenance fees are waived for investments in this portfolio.

• The Account Holder maintains control over the account.
• Any account growth is tax-deferred.
• Distributions are exempt from federal income tax when used for qualified education expenses.
• It's possible to make larger annual contributions without incurring the federal gift tax.

You can ask to have the funds paid out to the account holder, or the beneficiary, or name a different beneficiary. The new beneficiary must be a relative of the old beneficiary as defined by the IRS.

You don't have to be an Alaska resident to participate, so you can continue to maintain your account and make contributions no matter where you live.

• By check or money order (no credit cards)
• By electronic transfer, such as a wire transfer from your bank
• Through our Automatic Asset Builder - regular monthly deductions from your checking or savings account
• Through your PFD, by checking the "UA College Savings Plan" box on your PFD form
• By automatic payroll deduction
• By rolling over funds from another 529 plan, a Coverdell Education Savings Account, or a qualified U.S. Savings Bond

Total combined contributions for any one beneficiary can go up to $320,000. Please note that it's okay for earnings to take your total account balance over that amount. The maximum contribution may or may not cover all college expenses.

Yes! Half of your PFD (and/or your child's PFD) can be contributed automatically to an account. Just check "yes" in the UA College Savings Plan box on your PFD application. You can also invest the second half of your PFD when you receive it. You can even have the other half automatically deducted from your checking account. (For more details, click here for the "PFD" section.)

Yes! Half of your PFD (and/or your child's PFD) can be contributed automatically to Yes. They start by checking the college savings box on their PFD application. Then, after they receive a letter from us confirming their upcoming PFD contribution, they should send us a letter of instruction directing us to place their PFD contribution in the proper account. The letter must include their SSN as well as your account number and portfolio name. If they continue to contribute their PFD each year, it will automatically be invested in your account until we receive other instructions.

Certainly! Friends and family may contribute to your 529 account. It is a great gift idea for holiday and birthdays. They can use the Gift Contribution Slip or contribution slip included in your quarterly statements.

You can; however, this transaction may be taxable. Your 529 account will be set up with the minor as the account holder and beneficiary, and subsequent changes are limited.

Yes, at any time during your Upromise membership. You must send a letter requesting to withdraw contributions from your Upromise account. Your letter must include your full name and the exact amount you intend to withdraw (up to your total Upromise balance). Pending contributions are not eligible.

If your withdrawal request is more than $200, Upromise requires a Signature Guarantee certifying that your signature is genuine. Your bank can usually provide one. Withdrawal letters should be sent to:

Upromise
ATTN: Customer Care
P.O. Box 55555
Boston, MA 02205-5555

Since checks are mailed every calendar quarter, you should receive your Upromise funds within 12 weeks.

*This information is provided as a service to our Web site visitors. The UA College Savings Plan is not affiliated with, does not endorse, and is not endorsed by Upromise.

You should request your distribution at least two weeks before your payment deadline to ensure there is adequate time for us to process your request and have you receive the proceeds.

Only the account holder can request a distribution.

You can request a distribution over the phone by calling 1-800-478-0003, or you can complete a Request a Distribution Form and submit it by mail. Please allow up to a couple of weeks for processing and mail time.

You may take a distribution from your account anytime.

No, you do not. However, you should keep your receipts to substantiate your expenses to the IRS when you file your taxes.

Yes! If you provide us with your beneficiary's UA ID number, we can transfer the funds electronically to his or her account at UA. Please make your request at least two weeks prior to your payment deadline.

In addition to the information needed to identify your account, you should know how many tuition credits your beneficiary is enrolled in as well as the amount you want distributed for other education expenses. If requesting an electronic transfer of funds, you should also provide your beneficiary's UA ID number.

You can find this information on your quarterly statement. You can view a copy of your statement online after logging in to My Account.

Not from federal taxes. In some cases, they may be deductible from state income tax. For example, Pennsylvania, Maine, Arizona, and Kansas provide for state tax parity, whereby contributions to any 529 plan are eligible for the state's income tax deduction. Consult your tax professional.

Federal gift tax - Normally, gifts totaling more than $13,000 (in 2010) to an individual in a year are subject to the federal gift tax. Gifts to a 529 plan, however, can be made up to $65,000 (in 2010) in a year ($130,000 for married couples), and can be exempted when averaged over five years of tax returns.

Federal estate tax - If you die and there is money remaining in your account, it will be excluded from your estate for tax purposes. (There are exceptions, however, if your contributions were being averaged over five years as described above.)

Yes, at any time. Or you can transfer a portion of your investment to another beneficiary - for example, if you have another child. Please note that the new beneficiary must be a member of the previous beneficiary's family, as defined by the IRS.

Generally, yes, although special rules may apply to accounts with custodians. You can also name a successor account holder to take over for you in the event of your death, or if you are declared legally incompetent.

You can change your address online by logging into "My Account" and filling out the "Address Change Request Form." You can also print and mail an Update Your Account Services Form, or call us at 1-800-478-0003.

You can update your banking information on our Update Your Account Services Form.

The Plan offers three investment approaches with multiple portfolio options. You can pick one or spread your investment over any combination of two or all three approaches.

Each time you contribute to a beneficiary's account, you can select a different portfolio. You are allowed one reallocation between investment options in your 529 plan per calendar year. If you have already made one reallocations on your account this year, you cannot make another change until 2011.

You can view performance by visiting the Performance Page. Also, if you access your account online, you can view your contributions since inception

1. There is a $20 Annual Account Maintenance Fee, prorated across your accounts for the same beneficiary. That fee, however, is waived:
   • When you invest regularly through our Automatic Asset Builder or by payroll deduction.
   • For each of the beneficiary's accounts when at least one account is invested in the ACT Portfolio.
   • If your total balance for a beneficiary is $25,000 or more.
   • If your combined account balance, regardless of beneficiaries, is $75,000 or more.
2. There is an annualized program fee of 0.20% charged to each portfolio, except the ACT Portfolio. Each portfolio bears its share of the expenses of the underlying mutual funds in which it invests. The program manager fee and underlying mutual fund expenses are reflected in each portfolio's unit price. As with most investments, the portfolio also reflects some of the costs of the funds it invests in.

You can use them for any purpose, but to enjoy the full federal tax benefits - and to avoid penalties - they must be used for qualified educational expenses at an eligible institution as defined by the IRS. Such expenses include:

• Tuition and mandatory fees
• Books, supplies, and equipment required for enrollment or attendance
• Room and board for any academic period in which the beneficiary is enrolled at least half time
• Certain expenses required for special needs students

Use the Federal School Code Search on the FAFSA Web site (www.fafsa.ed.gov) to search for a complete list of eligible schools.

Yes! They can be used federal tax-free at practically every college, university, and technical school in the United States. For a complete listing of eligible institutions, visit www.fafsa.ed.gov.

The distribution may be subject to federal and state income taxes plus a 10% federal penalty. There are cases, such as in the event of a scholarship, appointment to a military academy, disability, or death of the beneficiary, where the distribution would not be subject to the 10% penalty, but may be subject to income taxes. Please see the Plan Disclosure Document for more information.

No; the distribution may be subject to federal and state income taxes plus a 10% federal penalty.