Does Your State Offer A Tax Deduction For 529 Plan Contributions?
The College Investor Audio Show · The College Investor
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Show Notes
One of the big perks of using a 529 plan to save for college is that many states offer a tax deduction for contributions to the plan. But, like anything, there are rules that apply.
Some states require you to contribute to their state's plan, while other states allow you to take the tax deduction for contributions to any state's plan. Finally, there are (sadly) states that don't offer any incentives for contributions.
Also, the rules for withdrawing can also impact your taxes. Make sure you understand the differences in qualified 529 plan withdrawals so you aren't paying taxes and penalties!