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I said: The San Jose Mercury News had a similar article (either this week or last week). I think that they made the point that withdrawals from the plan counted as income for the recipient, not for the contributors. Which if I read that right would seem to make this a very good deal for people in higher tax brackets (as presumably the student would have little other income and thus pay at rates of 15% or 28%).

And "TaxService" (a.k.a "Jack") said:
That's true!=:) I'm sure Roy made that point in his article.

The reason that I posted was that I thought the Roy was unusually opaque about this. Here is the best reference that I can see in his article:

Assume now that Jack and Jill pay $90,000 for their daughter's qualified education expenses. The tax issues are that $50,000 will not be taxed whatsoever (because it is simply a return of their original contributions), and they will pay tax on the $40,000 in previously tax-deferred earnings on the account.

When Roy says they in this paragraph, I assume that he means "Jack and Jill". In the following paragraph he talks about Jack and Jill manipulating their income in withdrawal years to get themselves into a lower tax bracket.

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