A prepaid tuition program is a type of 529 college savings plan that allows donors to provide all or part of a student's tuition for college or university.
Prepaid tuition plans enable parents, grandparents, and other individuals to prepay tuition at qualifying public and private schools or universities at today's rates.
You or your child must be a resident of the state that offers the plan. Beneficiaries of many prepaid tuition schemes are also restricted by age or grade.
Expenses under prepaid tuition plan are limited to tuition. The costs of equipment, supplies, room and board for your child's schooling cannot be covered by plan.
Prepaid tuition plans allow contributions to be made using after-tax dollars, means you are eligible to take state income tax deduction for the money contribute to plan.
Alaska, Florida, Illinois, Maryland, Massachusetts, Michigan, Mississippi, Nevada, Pennsylvania, Texas, Virginia, and Washington are offer prepaid tuition plans.