2010: A 529 Odyssey

The sunset provision of the tax-exempt status of 529 plans has always been expected to be repealed by congress. But not so fast.

The exemption from federal tax has been one of the plans' biggest selling points and undoubtedly has spurred their phenomenal growth - to nearly $70 billion in assets last year from approximately $12 billion in 2001, when the tax-exempt status was granted.

But prominent Washington attorney Helen Hubbard, partner at Baker & McKenzie LLP of Chicago and former tax legislative counsel at the Department of the Treasury, warned state administrators and financial services executives attending the opening general session of the recent College Savings Foundation Forum in Miami not to expect Congress to pass any major 529 legislation this year.

This is exactly the kind of thing that keeps well-informed financial advisors in business. Laws change pretty fast, if you don't have a good advisor, you could miss something.