529 Plan distributions for K-12

Submitted by Anonymous (not verified) on

You can use money contributed to a child's 529 Plan to pay for their K-12 education expenses. Pennsylvania will follow the Federal tax legislation signed into law on December 22, 2017, which includes several new provisions related specifically to 529 plan accounts, beginning with the 2018 tax year:
• Account owners can use assets to pay for qualified K-12 expenses up to $10,000 per year, per student.
• Account owners can treat K-12 withdrawals as qualified education expenses with respect to federal tax and PA PIT purposes.
• Account owners can roll over 529 plans to Achieving a Better Life Experience (ABLE) savings plans (an IRC Section 529A plan), up to the ABLE annual contribution limit as determined under IRC Section 2503(B). However, a taxpayer may not claim a deduction for the rollover amount on their PA-40 return.
Once again the Pennsylvania tax law follows the Federals tax law, the same as before, and allows the deduction for the expanded 529 plans.

More information: http://bit.ly/2BIOtQ3

Frequently Asked Questions: https://bit.ly/2w2KHQo

Tags