Governor Nathan Deal signed legislation that will double the state tax deduction for families filing a joint tax return for contributions made to the Path2College 529 Plan.
Beginning with returns filed in 2017, joint filers are eligible to deduct up to $4,000 per beneficiary, per year, giving families even more advantages to saving for education-related expenses. Contributions up to $2,000 per year, per beneficiary remain deductible for those who file single or head of household. (Limitations apply. Read the Disclosure Booklet carefully for details.)
Contributions to the plan made before the tax deadline each year are eligible for a state income tax deduction regardless of annual income.
House Bill 802, which was sponsored by Rep. Sam Teasley (R-Marietta), was signed into law May 3.
“This new law will incentivize families to save even more for their children’s and grandchildren’s future educational expenses,” said Mitch Seabaugh, executive director of the Path2College 529 Plan. “We are grateful to the General Assembly and Governor Deal for this added benefit and hope that it will help more families save for college.”
Families filing jointly can begin taking advantage of the increased deduction on their 2016 taxes.
The Path2College 529 Plan allows families to save for education-related expenses by investing as little as $25. Any earnings in the Path2College 529 Plan are also federal and Georgia income tax-deferred and withdrawals for qualified higher education expenses, which may include tuition, fees, books, supplies and equipment required for enrollment, such as computers and related technology such as internet access fees, software or printers, are federal and Georgia income tax-free. Contributions made to a Path2College 529 Plan account may reduce the taxable value of the account owner’s estate. Consult your tax advisor.
As of March 31, the Path2College 529 Plan has more than 134,000 beneficiaries with more than $1.9 billion invested for higher education expenses. More than 29,000 families have withdrawn more than $464 million to pay for education-related expenses.
For more information about the Path2College 529 Plan, visit www.Path2College529.com.
