529 Plans

How a Move Can Change Your 529 Plan Tax Deduction

The tax deduction you get for contributing to your state’s 529 plan can disappear if you move to another state.

Question: We opened a 529 college-savings plan in our home state of New York for a grandchild. But early this year, we moved to Idaho. Can we continue to deduct our contributions to the 529 on our Idaho income tax return?

Answer: You won’t get an Idaho state income tax deduction for contributing to the New York 529 plan. You can, however, qualify for an Idaho income tax deduction of up to $6,000 per year (or $12,000 for married couples filing jointly) if you open an account with the Idaho 529 plan and contribute to it. You can keep your New York 529 plan or roll the money over to the Idaho plan.

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