529 Plan

  • Creator
    Topic
  • January 23, 2019 at 3:38 pm #2178169
    ITSTIMETOPASS
    Participant

    So this is a real life questions.

    My friend has a 4 year old child and both him and his wife work in NJ with no tax deduction for 529 plan contribution. My friend’s dad has NY sourced income (NY does have tax deduction). Can my friend’s dad open up and 529 plan for his grandchild to get a deduction on his NY Nonresident Tax return?

    AUD: PASSED!
    REG: Q4 2015
    FAR:
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  • January 23, 2019 at 5:21 pm #2178400
    TheoneinDenver
    Participant

    Yes, grandparents can claim the deduction for contributing to a 529 if they live in one of the 34 states that offer a state income tax deduction for 529 college-savings plan contributions. The only question is whether you must own the account or whether you can contribute to one set up by, say, the child's parents-

    I don't have kids but a very small number of 529 plans may not accept third-party contributions. I would look into the NY rules for 529 Plans

    I'm not sure if this helps

    January 24, 2019 at 9:57 am #2179147
    Recked
    Participant

    This website seems to indicate yes, but I would do additional research.
    https://www.nysaves.org/home/why-ny-529-direct-plan/out-of-state-savers.html
    Requires work in NY and pay taxes to NY. Does not mention a residency requirement.

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