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State. Tax Treatment of 529 Plan Contributions. California. No deduction or credit. Illinois. Maximum deduction of $10,000 ($20,000 for married joint filers) per year
Here are the types of expenses that qualify for tax credits: Tuition and fees. Room and board ... it may come with some tax benefits. Many 529 plans let you deduct contributions from your state ...
A 529 plan allows a participant to set up a tax-advantaged account to allow a beneficiary to use the funds for qualified education expenses. The participant deposits after-tax money in the account.
The earnings portion of money withdrawn from a 529 plan that is not spent on eligible expenses (or rolled over into an ABLE account for any eligible family member) is subject to income tax, an additional 10% federal tax penalty, and the possibility of a recapture of any state tax deductions or credits taken. For example, if $50,000 is ...
Opening a 529 plan is a tax-advantaged way to set aside money for college. The money you contribute can grow tax-deferred and qualified withdrawals are tax-free. While there is no federal tax ...
Married people who file separately are not eligible for the deduction. 529 Savings Plan. 529 Plans, which are available in every state, can be a great way to stash away cash for college expenses ...