A 529 plan is a tax-advantaged investment account offered in the United States as a means to save for higher education expenses for a beneficiary. Many states offer their own version of a 529 plan.
529 plans are no longer just a tax effective means to save for college. Among many changes in the recent Tax Cuts and Job Act is a provision allowing you to distribute up to $10,000 per beneficiary during the taxable year for tuition expense incurred in relationship to a public, private or religious elementary or secondary school.
Most states, including Missouri, allow a deduction from your state taxable income for making contributions to state qualified 529 plans. Missouri allows this deduction for up to $8,000 per taxpayer, per year for contributions made to any state sponsored plan.
Beginning in 2018, you can now take tax free distributions from the account for qualified tuition expenses for Kindergarten through 12th grade, so long as you do not exceed $10,000 per beneficiary.
If you have any questions about 529 plan contributions, please contact Jaclyn Ellis, CPA at 314-576-1360 or email@example.com.