Mississippi Offers New Tax-Favored Higher Education Savings Program
April 16 Deadline For Tax Deduction

JACKSON, MS, March 20 -- State Treasurer Marshall Bennett announced today the availability of the Mississippi Affordable College Savings Program (MACS), a new tax-advantaged college savings plan for families to use to pay expenses at eligible colleges anywhere. MACS joins the Mississippi Prepaid Affordable College Tuition Program (MPACT), which has been available to residents since 1997 for tuition expenses only.

"According to recent statistics, the average cost of a four-year college education for a newborn will range from $100,000 at public universities to nearly $235,000 at private universities by the year 2018," Bennett said. "That's why it's important for parents to start a savings plan for their children's higher education now."

MACS is a flexible, simple-to-invest-in program that allows families of all income levels to open an account with a minimum investment of $25 ($15 through payroll deduction) and a maximum account balance limit of $235,000. The money can be used for future costs at nearly all colleges, universities, trade/vocational schools, or post secondary institutions in the country, as well as certain foreign schools. Expenses covered include tuition, fees, supplies, books, and certain room and board costs.

Tax Advantages
MACS also offers several key tax advantages, which include:

• State tax-exempt growth and an annual state income tax deduction for contributions up to $10,000 per individual ($20,000 for joint filers) per year.
• Federal tax-deferred growth with eventual taxes paid at the beneficiary's (future student's) rate, if used for qualified expenses.
• Significant gift and estate tax benefits. For instance, account owners may gift up to $50,000 in a single year ($100,000 for married couples filing jointly) per beneficiary without incurring federal tax consequences by spreading the gift-tax exclusion over five years, taking no more than a $10,000 exclusion in a single year. In addition, even though the Account Owner maintains control over the Account, amounts in the Account generally are not included in the Account Owner's Gross estate for federal estate tax purposes.

Important April 16 Tax Deadline
According to Bennett, the state income tax deduction is particularly important because of the April 16 filing deadline just around the corner. "Residents who open an account now, before that deadline, can deduct their contributions from their state income taxes for the year 2000. So I urge everyone to research the program as soon as possible and open an account," he said.

Professional Money Management
The State College Savings Board of Directors has selected as Program Manager, TIAA-CREF Tuition Financing, Inc., a wholly owned subsidiary of TIAA, part of the nation's largest and leading financial services group and the foremost pension and investment system for college faculties.

Information about MACS, including an application and a full Disclosure Booklet, is available from the Enroll Today section of this web site or by calling toll-free, 1-800-486-3670.

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