Governor Signs Bright Start Bill to Give Tax Deduction

              FOR IMMEDIATE RELEASE Contact: Carolyn Barry Frost
August 17, 2001 312/814-2997
GOVERNOR SIGNS BRIGHT START BILL
TO GIVE TAX DEDUCTION
-Investments Hit $120 Million Mark-
(SPRINGFIELD, IL) – State Treasurer Judy Baar Topinka today praised Governor George
Ryan for signing into law, legislation that provides for an additional tax advantage for Illinois
families contributing to Bright Start, the college savings program sponsored by Topinka’s office.
Governor Ryan signed the bill during the Future for Kids Day at the Illinois State Fair.
Senate Bill 902 will allow individuals who open a Bright Start account to have their
contributions deducted from their Illinois State income taxes.
“The Bright Start program has experienced tremendous success, reaching $120 million in
investments during our first eighteen months, and this bill will give us the necessary tools to make
saving for college even easier,” said Topinka.
“Bright Start gives Illinois residents a clear choice when it comes to the higher education
needs of their children through its flexibility, ease and sound investment options,” Topinka said. “By
taking advantage of various tax breaks, families from all walks of life will have an easier time
providing for their children’s higher education.”
Senate Bill 902 provides that for income tax years commencing on or after January 1,
2002, monies contributed to a Bright Start account will be excluded from a taxpayer’s gross income
for purposes of State tax liability.
What this means, for example, is that if someone earns $50,000 per year and contributes
$5000 per year to a Bright Start account, the person would only pay State income tax on $45,000
as opposed to on the total $50,000.
“This tax incentive will encourage Illinois citizens to save for college and it will make it
easier for them to do so,” said Topinka. In addition to the tax deduction, Bright Start accounts
allow investments earnings to be exempt from State and Federal income taxes.
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From the Office of State Treasurer JUDY BAAR TOPINKA