Here is a near-year-end reminder to Indiana residents regarding the state’s CollegeChoice 529 Savings Plan. Indiana taxpayers are eligible for a state income tax credit of 20% of contributions, up to a $1,000 credit per year. When you do the math, annual contributions of $5,000 will give you the maximum credit of $1,000 on your Indiana state income taxes. Keep in mind, that’s a credit, not a deduction – much more valuable! In order to take advantage of this credit 2009 contributions need to be made by December 31, 2009. Unlike IRAs, you cannot make a contribution in early 2010 and make it count for 2009. Don’t miss the 12/31/09 deadline!
There’s also an important update for 2010. After the first of the year, the Indiana CollegeChoice 529 Savings Plan will no longer count rollover contributions from other 529 plans toward the 20% state income tax credit. Bottom line, it needs to be new money, not a rollover from another 529 plan. Rollovers are still allowed for tax credit purposes in 2009.
You can fire an e-mail to Bob Nicholas by clicking here, or you may call him at 427.7003.
You should expect a shameless sales pitch, but Bob’s a nice guy and will probably just answer your questions, too.
And clicking here will take you to the Indiana 529 plan website.