Pennsylvania Statutes Title 24 P.S. Education § 6901.316. State tax exemption

(a) Property of funds.--The property of each of the funds and their income and operation shall be exempt from all taxation by the Commonwealth and its political subdivisions.

(b) Contributions.--Contributions made pursuant to a Tuition Account Program Contract; any increase in the value of those contributions, the retention, or transfer during life or as a result of death of any legal interest in a Tuition Account Program Contract; and payment of qualified higher education expenses of beneficiaries made pursuant to Tuition Account Program Contracts shall be exempt from all taxation by the Commonwealth and its political subdivisions.