Preparing for CollegeAmerica distributions

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Logo. CollegeAmerica is a nationwide plan sponsored by Commonwealth Savers

Get answers to clients’ most common distribution questions and review options for taking them.

Your clients’ CollegeAmerica® funds can be withdrawn free from federal tax for a wide range of qualified education expenses. These include tuition and fees for college, graduate school and vocational and trade schools as well as a variety of noncollege educational and occupational training expenses. For additional information about qualified expenses, as well as the tax implications of taking a nonqualified distribution, review CollegeAmerica qualified education expenses.

If distributions are used for purposes other than qualified education expenses, the earnings will be subject to a 10% federal tax penalty in addition to federal and, if applicable, state income tax. States take different approaches to the income tax treatment of distributions. For example, distributions for K-12 expenses may not be exempt from state tax in certain states. Consult a tax advisor for state-specific details.

Make sure to verify with your firm that you’re permitted to request third-party distributions to colleges or universities.

You’ll need the following:

  • Institution’s name
  • Institution’s billing address (which could be different from the physical address)
  • Beneficiary’s student ID number

Log in to Client Accounts to distribute the funds by:

  • Check via USPS (allow 7 to 10 business days)
  • Check via expedited delivery (allow 2 business days)

The distribution will be reported under the beneficiary’s Social Security number.

Yes, as long as the other student is a member of the current beneficiary’s family. If so, the funds must be transferred to the new beneficiary first using the CollegeAmerica Account Change Request so the distribution is reported correctly. Also include the CollegeAmerica Distribution Request to expedite the request.

Learn more about who is considered a member of the family.

Distribution options

Process a distribution online

Most CollegeAmerica distributions to the owner, school or beneficiary can be processed online.

Log in to Client Accounts.

Process a distribution by mail

For distributions that require a signature guarantee, use this form and submit it by mail.

Complete the CollegeAmerica Distribution Request.

Link a bank account

To link the owner’s or beneficiary’s bank account for future distributions, use this form.

Complete the Add/Update Bank Information form.

Explore more on managing CollegeAmerica accounts during tuition season

CollegeAmerica distributions single sheet

Share this single sheet with your clients when they have questions about how to distribute money from their CollegeAmerica accounts.

Get single sheet

CollegeAmerica taxes

Review tax reporting for qualified and nonqualified distributions from CollegeAmerica accounts.

Learn more

Distribution options

Review your clients’ options for taking CollegeAmerica distributions and determine the best fit for their needs.

Learn more

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Contact us

Have questions or need additional support?
Contact us 8:00 a.m. to 7:00 p.m. ET, Monday through Friday.

(800) 421-0180

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Use of this website is intended for U.S. residents only.

The guidelines and procedures provided in the Account Resource Center may not apply to networked accounts or accounts not directly held by American Funds. The guidelines and procedures provided also apply only to those retirement accounts or Coverdell ESAs invested in American Funds with Capital Bank and Trust Company (CB&T) as custodian. The guidelines and procedures provided in the Account Resource Center do not apply to plans held in our retirement plan solutions — PlanPremier, PlanPremier-TPA or RecordkeeperDirect. Information on the Account Resource Center may change periodically, and previously printed information may not be current. Please refer to capitalgroup.com for the most current information available.

Financial professionals should always contact their back office to determine if there are any restrictions on the use of American Funds products, tools, services, websites and literature.

CollegeAmerica is distributed by Capital Client Group, Inc. and sold through unaffiliated intermediaries.

Depending on your state of residence, there may be an in-state plan that provides state tax and other state benefits, such as financial aid, scholarship funds and protection from creditors, not available through CollegeAmerica. Before investing in any state’s 529 plan, investors should consult a tax advisor.