Author Topic: Massachusetts approves income tax deduction for 529 plan  (Read 2188 times)

easternblockbabe

  • 5 O'Clock Shadow
  • *
  • Posts: 12
Massachusetts approves income tax deduction for 529 plan
« on: January 16, 2017, 12:22:06 PM »
I just found out this and would like to share it:

Starting in 2017, residents of Massachusetts can deduct contributions to an in-state 529 college savings plan, up to $1,000 per individual or $2,000 per married couple filing jointly.  This is good news for those of us filing taxes in MA!

http://www.savingforcollege.com/articles/massachusetts-to-offer-529-state-tax-deduction-973

I just love to see my savings grow!

gimp

  • Handlebar Stache
  • *****
  • Posts: 2360
Re: Massachusetts approves income tax deduction for 529 plan
« Reply #1 on: January 19, 2017, 04:01:24 PM »
Wish CA would do this. I'd start a 529 ... right now it doesn't seem useful.

nvmama

  • 5 O'Clock Shadow
  • *
  • Posts: 91
  • Age: 40
  • Location: MA
Re: Massachusetts approves income tax deduction for 529 plan
« Reply #2 on: February 26, 2017, 07:47:25 PM »
I'm in MA and thinking about taking advantage of this while we can.  However, we never planned to save for our kid's college costs, so I'm a but nervous about it.  Especially if none end up going to college, but odd are at least one will. 
Does anyone have any experience with the MA 529 plans?

RelaxedGal

  • Bristles
  • ***
  • Posts: 252
  • Age: 39
  • Location: 495 corridor, Massachusetts, USA
Re: Massachusetts approves income tax deduction for 529 plan
« Reply #3 on: March 01, 2017, 01:57:48 PM »
No experience other than opening an account last night because I'd learned about it.  The cap is $2,000 for married couples filing jointly ($1000 otherwise), so even if you contribute for the next 18 years and your kid doesn't go to college, that's only $36,000 + growth.  The 10% withdrawal penalty is on the growth so what, you've earned another $36K if things are going gangbusters in the stock market for those 18 years?  $3600 possibly penalty, 5.1%x$2000x18 = $1836 definite reward*.

It's a risk, but I'm pretty confident my daughter will go to college/voc/trade school.  It's a small enough risk that I'm going for it. 

* Aw crud, this article says it's scheduled to end after 5 years.  That brings down my Definite Reward number.  Your Mileage May Vary.

Frizhand

  • 5 O'Clock Shadow
  • *
  • Posts: 61
Re: Massachusetts approves income tax deduction for 529 plan
« Reply #4 on: April 04, 2017, 08:33:01 AM »
Anyone know if there are any income limits or phase outs to this deduction?  I've been contributing to the MA 529 for years but stopped recently.  Now that there is a tax deduction I'm thinking I should start again...my oldest heads to college in 3 years!