Does Indiana have a 529 tax deduction?
Indiana taxpayers can get a state income tax credit equal to 20% of their contributions to a CollegeChoice 529 account, up to $1,000 per year ($500 for married filing separately). Tax-deferred growth. Earnings grow tax deferred from federal and state taxes. Tax-free withdrawals.
Does Indiana have a 529 plan?
CollegeChoice 529 Savings Plan is administered by the Indiana Education Savings Authority. Ascensus Broker Dealer Services, LLC, serves as the program manager and provides investment advisory, recordkeeping and administrative services. The program allows users to save money for post-secondary expenses.
What can you spend 529 funds on?
Qualified expenses that 529s cover.
How much can you contribute to a 529 in Indiana?
$1,000 credit per year
If you are an Indiana taxpayer (resident or non-resident, married or individual), you are eligible for a state income tax credit of 20% of contributions to a CollegeChoice 529 account, up to $1,000 credit per year.
What happens to money in 529 if not used?
A 529 college savings plan allows families to save money for their child’s college education in a tax-free investment account. If the money is used for anything outside of the qualified education expenses, the family must pay a tax penalty of 10% on the plan’s earnings.
What happens to 529 if child does not go to college?
If assets in a 529 are used for something other than qualified education expenses, you’ll have to pay both federal income taxes and a 10% penalty on the earnings. (An interesting side note is that if the beneficiary gets a full scholarship to college, the penalty for taking the cash is waived.)
How much can you contribute to a 529 plan in 2021 in Indiana?
Individuals may contribute as much as $80,000 to a 529 plan in 2021 if they treat the contribution as if it were spread over a 5-year period. The 5-year election must be reported on Form 709 for each of the five years.