A Program of the Tennessee Department of Treasury · David H. Lillard, Jr., State Treasurer

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Legacy Planning

Create a Legacy Through the Gift of Education

Whether you're a grandparent, a godparent, an aunt, an uncle, or a family friend who wants to make a difference in the life of a child, TNStars can help.

One of the most meaningful gifts you can give a child is a bright future, and few things are as empowering to children as a great education. The cost of a college education is climbing each year, and it's difficult for a young person to afford it without help from the people who care about them.

With only $25 and 15 minutes, you can open an account on behalf of that special child in your life. If that child is already enrolled in TNStars, you can contribute directly to that account through our gifting options. Anyone can open an account with TNStars, and those that do will enjoy all of the following program highlights...

  • Contributions qualify for the annual gift tax exclusion
  • Earnings are exempt from federal & state taxes when used for qualified expenses
  • Diverse investment options
  • Save for any school that accepts federal aid including: private universities; out-of-state universities; international universities; technical colleges
  • Savings can be used for tuition, books, room and board
  • Choose investment options based on your savings goal, risk tolerance and timeline

Ready to Start Saving?

Grandmother with Grandchild

Legacy Planning

Tax advantages for gifting

With TNStars, there is no federal gift tax on contributions up to $18,000 per year for single filers and $36,000 for couples filing jointly. Gifting assets is one way to reduce exposure to the estate tax. The advantage with 529 plans is that the value of the account is removed from your taxable estate, but you still control the account.

If you decide to jump-start the account of a beneficiary and exceed $18,000, you can do so through "superfunding". Under special rules unique to 529 plans, you can gift a lump sum in a given year -- up to $85,000 for individual and $170,000 for joint filers and avoid federal gift tax by making an election to treat the gift as if it were made evenly over a five-year period.

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