Question

College savings program

Forum|Forum|6 years ago
March 9, 2020
1 reply
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I am a grandparent and an Illinois resident. I am contributing to a 529 college program in Michigan for my grandkids. Am I able to claim those monies under the College Savings and pre-paid tuition programs on Illinois taxes?

ColeenD3

Unfortunately, no.

State Income Tax Information

In addition to federal tax benefits, there are state tax benefits as well. For MESP, tax treatment is as follows:

Contributions are deductible for Michigan income tax purposes up to $5,000 per year for a single income tax return filer and $10,000 per year for joint filers. Incoming rollovers from another 529 account, however, are not eligible for the tax deduction.

Qualified Withdrawals, certain outgoing rollovers, and certain federally Taxable Withdrawals are not subject to Michigan income tax for either the account owner or the beneficiary.

Michigan tax benefits related to the MESP are available only to Michigan tax payers. You should talk to a qualified advisor about how Michigan tax provisions affect your circumstances.

MI 529