Providing Every Child a Road to Opportunity
The St. Louis region is home to some of the best K-12 education options in America – this includes private schools, public schools, public charter schools, magnet schools, online academies, and homeschooling. Over the next few days, as we continue to celebrate School Choice Week and opportunity in education, we must also raise awareness about what can and is being done to provide every student access to the best education possible.
A good education is the foundation for a prosperous and secure future in this country, and a student’s future should not be limited by their zip code or household income. We know that when parents are empowered to choose the educational environments they believe work best for their kids, students are more likely to succeed and graduate from high school. American children, no matter where they live, should have the opportunity to receive an outstanding education, and should never be trapped in a school that is failing their educational needs.
The Tax Cuts and Jobs Act enacted last month contains the most significant school choice expansion by the federal government in at least 20 years. Parents can now use 529 savings plans—traditionally used to pay for college and other higher education needs—to pay tuition at an elementary or secondary school. This includes private and parochial schools and provides parents with a new avenue to save for their children’s primary education. As a mother of three wonderful children whom I put through St. Clare of Assisi, Ursuline, Priory, and SLUH, I know my husband Ray and I would have loved to have had this opportunity.
The purpose of a 529 plan is to allow your after-tax contributions to grow tax-free. Contributions and earnings from the plan can then be withdrawn tax-free to pay for the child’s educational needs. And one great feature of a 529 plan is that anyone can set up a plan. That means parents, grandparents, relatives or even friends can set up an account and save up to $15,000 per year or $30,000 per couple in that account. This new law will allow up to $10,000 per year to be withdrawn from the account to pay for education expenses. And here in Missouri, each individual can deduct up to $8,000 worth of 529 plan contributions per year from their state income taxes, and a couple can deduct up to $16,000 of contributions.
The expansion of 529 college savings plans not only provides Missouri families with more education options, but also promotes a culture of saving that will ensure families have a more secure financial future. Last year, the total investment by U.S. families in 529 plans reached a record level of $275 billion and grew to more than 12 million accounts. I hope that number continues to grow and I strongly encourage Missouri families to evaluate the educational opportunities available for their children, and to consider this tax-advantaged option. Every child deserves the opportunity to achieve the American Dream.
To find out more about Missouri’s 529 program, MOST, and how you can save for a child’s elementary or secondary education, please visit www.missourimost.org or call 888-414-MOST (6678).