The 529 plan, named for the section of the Internal Revenue Code that allowed the plans to come into existence, is a type of investment account. Any money you put in will have been subject to normal income taxes first (but if your state offers a 529 plan, and you participate in it, you may get a tax deduction). But once you put money into a 529 account, you don’t pay taxes on the investments earnings while they’re parked in the account or when you take them out to pay for college. This is always the case, as long as you use the proceeds for tuition, room, board or other expenses. There are different 529 plans for almost every state.