Rollovers/Transfers From Custodial Accounts

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Assets may be transferred from an UGMA/UTMA account into Future Scholar, but there are significant legal and tax considerations that should be considered:

  1. Because the custodian of an UGMA/UTMA must first sell the assets in the UGMA/UTMA account, the sale of the UGMA/UTMA assets may generate taxable gains.

  2. When the custodian invests in Future Scholar, the beneficiary of the Future Scholar account must be the same as the beneficiary of the UGMA/UTMA account and cannot be changed. This means that the Account Owner will not be able to change the Beneficiary of the Account and may not authorize any distribution from the Account unless the distribution is for a use permitted under the law governing the UGMA/UTMA custodial account.

  3. For financial aid purposes the assets are treated as those of the student, since the custodial status takes precedence over the 529 plan (529 plans that are not under Trust or custodial registration are treated as assets of the account owner for financial aid purposes.

  4. Proceeds check must be made payable to Future Scholar, (name of custodian) Cust. (insert UGMA/UTMA, as applicable, followed by the pertinent state) FBO (name of Designated Beneficiary).

Please consider the investment objectives, risks, charges and expenses carefully before investing in the Future Scholar 529 College Savings Plan. Contact your financial advisor or Columbia Management for a Program Description, which contains this and other important information. Read it carefully before investing. You should consider, before investing, whether the investor’s or designated beneficiary’s home state offers any state tax or other benefits that are only available for investments in such state’s qualified tuition program. Columbia Management Investment Distributors, Inc., distributor and underwriter.

This information does not constitute tax or legal advice. Neither the State Treasurer, Columbia Management Investment Advisers, LLC, nor its affiliates, provide tax or legal advice. Please consult your tax advisor before making tax-related decisions.
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© 2010 South Carolina Office of State Treasurer

On April 30, 2010, Ameriprise Financial, Inc., the parent company of RiverSource Investments, LLC, acquired the long-term asset management business of Columbia Management Group, LLC, including certain of its affiliates, which were, prior to this acquisition, part of Bank of America. In connection with the acquisition of the long-term assets, certain clients of Columbia Management Advisors, LLC (including the Columbia Funds) have a new investment adviser, RiverSource Investments, LLC, which is now known as Columbia Management Investment Advisers, LLC. On the same date, Ameriprise Financial also acquired Columbia Wanger Asset Management, LLC (CWAM). CWAM will continue as the investment adviser for Columbia Acorn and Wanger Funds and no changes are anticipated in the existing investment management team. For those clients that use the services of a subadviser, those arrangements are continuing unless notified otherwise. RiverSource Fund Distributors, Inc., now known as Columbia Management Investment Distributors, Inc., member FINRA, will act as the principal distributor of the Columbia, Wanger, Columbia Acorn, RiverSource, Seligman and Threadneedle branded funds. RiverSource Service Corporation, now known as Columbia Management Investment Services Corp., is the transfer agent for the Funds.

Investments made in Future Scholar are: NOT FDIC INSURED. No Bank Guarantee.May Lose Value.