President Makes 529-Plan-Distribution Tax Exemption Permanent

President Bush has signed into law a bill that makes permanent the federal tax exemption for distributions from so-called Section-529 college savings plans. The tax exemption originally was scheduled to expire in 2010. Section-529 plans allow investors to save money in special accounts in which the earnings grow income-tax deferred and, when used to pay for “qualified higher education expenses,” will be federal income-tax free.