JEFFERSON CITY — A select number of Missouri families who save money for college tuition could be rewarded with scholarships.
State Treasurer Sarah Steelman said Thursday that all of Missouri’s public universities now have agreed to provide some scholarships to students enrolled in the Missouri Saving for Tuition program — a tax-free way to invest money for college.
Each state sponsors some sort of 529 college savings plan, nicknamed for the federal tax code under which they are established. In Missouri, it’s overseen by the treasurer’s office.
Steelman said each university is determining how many scholarships to provide and setting its own eligibility criteria. The $500 scholarships should be in place for the 2008-2009 school year, she said.
“What I was trying to do is provide an incentive for more parents to start saving earlier for their children’s education and to know that there’s a reward at the end” from a potential scholarship, Steelman said at a news conference.
Steelman is running for governor in the Aug. 5 Republican primary against U.S. Rep. Kenny Hulshof. The winner is expected to face Democratic Attorney General Jay Nixon in the general election.
According to the treasurer’s office, the University of Missouri System has agreed to provide 80 scholarships split among its four campuses for students using Missouri’s college savings plan.
Missouri State University has agreed to provide 12 scholarships, Northwest Missouri State University will give 25 scholarships and Truman State University 15 scholarships. Missouri Western State University, Lincoln University and the University of Central Missouri agreed to give 10 scholarships.
Scholarship details are still being worked out with Harris-Stowe State University, Southeast Missouri State University and Missouri Southern State University, the treasurer’s office said.
Earlier this year, legislators passed a measure allowing married couples to deduct up to $16,000 annually — instead of the standard $8,000 for an individual taxpayer — from their state income taxes for deposits into college savings plans.
The legislation also expanded Missouri’s investment tax break to apply to any 529 college savings plan — not only the Missouri-sponsored plan, which had been the case.
Steelman did not take an active role in expanding the tax break to other states’ plans. She said Thursday that she supports tax breaks that encourage families to save for college but hopes most families will choose the Missouri-sponsored plan.
Steelman’s predecessor, Democratic Treasurer Nancy Farmer, had opposed expanding the tax breaks to other states’ plans, saying that could jeopardize Missouri’s program.