Assemblyman Joe Giglio (R,C,I-Gowanda) today announced that a new law, passed this week, will make it easier for parents and students to save for college by allowing relatives, employers and others to contribute to state-sponsored college savings accounts.
“With the cost of attending college skyrocketing, paying for college has become an increasingly difficult challenge,” said Giglio. “It is important that we help provide parents and young students every opportunity to save, and this new law is a step in the right direction.”
The law, sponsored by Giglio, eases restrictions on third party contributions to college savings funds, including the New York State College Tuition Savings Program. The program, which began in 1998, allows for tax-deductible contributions and tax-free withdrawals for qualified higher education expenses. While the program has helped contributors pay for $8.3 million in college expenses, until now it has only accepted contributions from individuals who created the account, usually parents. Due to this provision, over $57 million in contributions have been rejected from other parties within the last five years. The new law will allow anyone, including family members, employers or a scholarship fund, to contribute, although contributions from account holders will remain tax deductible.
“By easing the restrictions on college savings funds, this law will allow for more students to realize the dream of higher education, and help prepare our future leaders for the challenges that lie ahead,” concluded Giglio.