Using The Plan - Withdrawals

Q. When can I take money out of my account?

A. Anytime. There is no minimum length of time that contributions must remain in your account before you can request a withdrawal.

If you make a withdrawal for something other than a qualified college expense (non-qualified withdrawal), the account owner will be required to pay federal income tax and an additional 10 percent federal tax on the earnings, if any. There are certain exceptions: death or disability of the beneficiary or if the beneficiary receives a scholarship.

The account owner is responsible for reporting all withdrawals to the IRS. You should retain receipts, invoices or other documents and information adequate to substantiate that a particular expense is a qualified or non-qualified withdrawal.

We cannot provide tax advice and encourage you to consult your own tax advisor before making a withdrawal or taking any other action regarding the Florida College Investment Plan.

Q. What if the student does not start college when originally planned or goes to college part time?

A. You can withdraw money from your account at any time. It doesn't matter if the student (beneficiary) does not start college when originally expected or enrolls in college part time.

The student must be enrolled at least halftime for any portion of room and board expenses to be considered a qualified higher education expense.

Q. How do I make a withdrawal from my account?

A. The account owner must request all withdrawals in writing. The account owner must sign the request. Click here for the Withdrawal Form.

The account owner may request that the withdrawal/distribution be made payable to the account owner, to the beneficiary (student) or to an eligible college.

The account owner is responsible for reporting all withdrawals to the IRS. You should retain receipts, invoices or other documents and information adequate to substantiate that a particular expense is a qualified or non-qualified withdrawal.

We cannot provide tax advice and encourage you to consult your own tax advisor before making a withdrawal or taking any other action regarding the Florida College Investment Plan.

Q. What are qualified withdrawals?

A. Qualified withdrawals are distributions used to pay for the qualified higher education expenses of the beneficiary (student) listed on the account.

The account owner is responsible for reporting all withdrawals to the IRS. You should retain receipts, invoices or other documents and information adequate to substantiate that a particular expense is a qualified or non-qualified withdrawal.

We cannot provide tax advice and encourage you to consult your own tax advisor before making a withdrawal or taking any other action regarding the Florida College Investment Plan.

Q. What are non-qualified withdrawals?

A. A non-qualified withdrawal is any distribution other than a qualified withdrawal or a withdrawal due to beneficiary (student) death, disability or scholarship. The earnings portion of any non-qualified withdrawal is subject to federal income tax and an additional 10 percent federal tax.

The account owner is responsible for reporting all withdrawals to the IRS. You should retain receipts, invoices or other documents and information adequate to substantiate that a particular expense is a qualified or non-qualified withdrawal.

We cannot provide tax advice and encourage you to consult your own tax advisor before making a withdrawal or taking any other action regarding the Florida College Investment Plan.

Q. Will I have to pay taxes on withdrawals from my account?

A. Beginning January 1, 2002, withdrawals for qualified higher education expenses are exempt from federal income tax.

Earnings on qualified withdrawals are exempt from State of Florida taxes, such as intangible taxes.

If you make a withdrawal for something other than a qualified college expense (non-qualified withdrawal), the account owner will be required to pay federal income tax and an additional 10 percent federal tax on the earnings, if any. There are certain exceptions: death or disability of the beneficiary or if the beneficiary receives a scholarship.

The account owner is responsible for reporting all withdrawals to the IRS. You should retain receipts, invoices or other documents and information adequate to substantiate that a particular expense is a qualified or non-qualified withdrawal.

We cannot provide tax advice and encourage you to consult your own tax advisor before making a withdrawal or taking any other action regarding the Florida College Investment Plan.

Q. What if the student receives a scholarship?

A. If the beneficiary (student) receives a scholarship, you can use your plan to pay for any qualified college expenses that are not covered by the scholarship. You can transfer the account to another qualified beneficiary. Or you can request a withdrawal for the amount of the scholarship without incurring the additional 10 percent federal tax; however, the earnings portion of the scholarship refund is subject to federal income tax. A scholarship refund withdrawal cannot exceed the allowances under section 25A(g)(2) of the IRS code. The plan does not charge any fees for a withdrawal due to a scholarship award.

The account owner is responsible for reporting all withdrawals to the IRS. You should retain receipts, invoices or other documents and information adequate to substantiate that a particular expense is a qualified or non-qualified withdrawal.

We cannot provide tax advice and encourage you to consult your own tax advisor before making a withdrawal or taking any other action regarding the Florida College Investment Plan.

Q. Do I have to provide receipts or invoices with a request for a qualified withdrawal?

A. No. However, since the account owner is responsible for reporting all withdrawals to the IRS, you should retain receipts, invoices or other documents and information adequate to substantiate that a particular expense is a qualified or non-qualified withdrawal.

We cannot provide tax advice and encourage you to consult your own tax advisor before making a withdrawal or taking any other action regarding the Florida College Investment Plan.

Q. Can I specify which investment option my withdrawal should be taken from? If not, how is it determined from which investment option(s) the withdrawal will be made?

A. No. Withdrawals are deducted from your selected investment options on a pro-rated basis, calculated on your total account value.

For example, if your account value is $100,000 with $50,000 in the Equity Investment Option, $25,000 in the Age Based/Years to Enrollment Investment Option and $25,000 in the Fixed Income Investment Option and you request a withdrawal for $10,000, the withdrawal will be deducted as follows: $5,000 from the Equity Investment Option, $2,500 from the Age Based/Years to Enrollment Investment Option and $2,500 from the Fixed Income Investment Option.

Q. Is there any limit on the number of withdrawals I can make or the dollar amount of my withdrawals?

A. We encourage you to make no more than six withdrawals per year. However, there is no limit on the number or the dollar amount of withdrawals.

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