Putnam Investments of Boston has been awarded the management contract for the new college investment program sponsored by the state of Ohio. This is the first state-sponsored college investing plan management contract Putnam has been awarded.
The Ohio College Savings Program, known as a 529 Plan, will begin operating in the fall. Federal taxes on contributions to the plan and earnings are deferred until assets are withdrawn. Individuals living in any state can establish an Ohio college savings account for a child. Residents of Ohio receive an extra state income tax deduction for up to $2,000 in annual contributions made to the plan. The plan assets and earnings must be used to pay for college expenses.
Putnam has not yet decided which of its mutual funds will be made available to Ohio's savings plan participants, according to a Putnam spokesperson.