The break will allow families to save $2,000 a year for each child to attend college that will be tax deductable.
Rich people from across the U.S. are calling Topeka for information about a new Kansas tax break for college savings, State Treasurer Tim Shallenburger said Tuesday.
"It's easy to sell it to the rich," he said. But "the rich don't need another tax break. This is for people who wouldn't necessarily save for college. I think eventually more low- or middle-income people will benefit."
Shallenburger was at the Journal-World on Tuesday to tout the new Kansas Post-secondary Education Savings Program, which allows those who sock away up to $2,000 a year for college to deduct the same amount from their state income tax.
Through the program, parents can save up to $2,000 annually for each child or beneficiary and claim deductions for each.
A second tax benefit from the program: Interest earned from the savings is exempt from both state and federal income tax.
The tax break, approved by the Legislature this year, becomes effective July 1, 2000. Anyone can use the program, not just Kansas residents. That has prompted out-of-state wealthy shopping for tax protected savings opportunities to contact the treasurer's office about enrolling.
Dollars enrolled in the program will be managed by a professional fund manager yet to be selected by Shallenburger. He said he plans to have a firm or manager under contract before year's end.
Shallenburger said he hopes the program is used most by the lower-income Kansans now considered least likely to save for education. But that same portion of the population is the least likely to hear about the program. Unlike the well-to-do, they don't have accountants or tax advisers to make them aware of the new tax break.
He said he is doing what he can to publicize the program and also will select a fund manager, in part, based on "how much they help us promote to the poor."
Though the treasurer's office will administer the program and hire the manager, "we don't have a lot of money for marketing," Shallenburger said.
The savings can be used for any sort of post-secondary education.
"You can use it for truck-driving school, beautician school or Harvard," Shallenburger said. "But if you're going to Harvard, you better save more."
Information about the program is available at the state treasurer's Web site: www.kansasstatetreasurer.com/savings.
-- Mike Shields' phone message number is 832-7154. His e-mail address is firstname.lastname@example.org.