529 plan contribution deadlines for state tax benefits

Kathryn FlynnBy Kathryn FlynnBy Savingforcollege.com
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As we head into the final weeks of 2018 you may be looking for ways to reduce your taxable income. If you’re currently saving for college, you may qualify for a state income tax credit or deduction for contributions to a 529 plan. Over 30 states, including the District of Columbia, currently offer this type of perk, and the rules vary by state. The list below includes details about the tax benefits offered, the contribution deadline and the maximum 529 plan balance each state allows.

Click on the state’s name to see the plans it offers. Remember, you don’t have to use your home state’s plan and you can use a 529 college savings plan to pay for an eligible institution in any state.

Alabama

State tax benefit: Contributions and rollover contributions up to $5,000 for a single return and up to $10,000 for a joint return are deductible in computing Alabama taxable income.

Deadline: December 31, 2018.

Maximum aggregate plan balance: $475,000

Arizona

State tax benefit: Contributions to in-state and out-of-state 529 plans of up to $2,000 for a single return and up to $4,000 for a joint return are deductible in computing Arizona taxable income.

Deadline: December 31, 2018

Maximum aggregate plan balance: $476,000

Arkansas

State tax benefit: Contributions up to $5,000 for a single return and up to $10,000 for a joint return are deductible in computing Arkansas taxable income, with a four-year carryforward of excess contributions. Contributions to a NON-Arkansas plan of up to $3,000 per year by an individual, and up to $6,000 per year by a married couple filing jointly, are deductible. Rollover contributions from another state's plan are deductible in the amount of $7,500 per individual and $15,000 per couple.

Deadline: December 31, 2018

Maximum aggregate balance: $366,000


Colorado

State tax benefit: Contributions to a Colorado 529 plan by anyone are deductible in computing Colorado taxable income. Rollover contributions are not eligible.

Deadline: December 31, 2018

Maximum aggregate balance: $400,000

Connecticut

State tax benefit: Contributions and rollover contributions up to $5,000 for a single return and up to $10,000 for a joint return are deductible in computing Connecticut taxable income, including a five-year carryforward for excess contributions. Rollover contributions are not eligible.

Deadline: December 31, 2018

Maximum aggregate plan balance: $300,000

District of Columbia

State tax benefit: Contributions and rollover contributions up to $4,000 for a single return and up to $8,000 for joint taxpayers who each make a contribution to their own account, with a five-year carryfoward for excess contributions, are deductible in computing DC taxable income. Deductible contributions must be made by the account owner and rollover contributions are not eligible.

Deadline: December 31, 2018

Maximum aggregate plan balance: $500,000


Georgia

State tax benefit: Contributions of up to $2,000 per beneficiary per year for those filing a single return and $4,000 per year per beneficiary for those filing a joint return are deductible in computing Georgia taxable income. Incoming rollovers from other 529 plans do not qualify as contributions eligible for the state income tax deduction.

Deadline: April 15, 2019

Maximum aggregate plan balance: $235,000


Idaho

State tax benefit: Contributions and rollover contributions up to $6,000 for a single return and up to $12,000 for a joint return are deductible n computing Idaho taxable income.

Deadline: December 31, 2018

Maximum aggregate plan balance: $500,000

Illinois

State tax benefit: Contributions and rollover contributions up to $10,000 for a single return and up to $20,000 for a joint return are deductible from Illinois state income tax. Only the principal portion of rollover contributions is eligible.

Deadline: December 31, 2018

Maximum aggregate plan balance: $400,000

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