Alabama
8:48 am
Wed February 23, 2005

College Savings Plan Could Be Tax-Exempt

Montgomery, AL – The state Legislature is trying to exempt Alabama's college savings plan from state income taxes. The House approved a tax exemption bill Tuesday. And the Senate Finance and Taxation-Education Comimttee will consider a similar bill today. The speedy legislative action comes after a recnet report by the Morningstar fund rating agency. It listed Alabama as having one of the five worst college savings plans in the nation because withdrawals were taxed by the state. State Treasurer Kay Ivey administers the plan. She says the pending legislation will encourage more people to save for their children's college education.