How does a 529 plan work in Pennsylvania?

How does a 529 plan work in Pennsylvania?

Pennsylvania taxpayers can deduct contributions to the PA 529 IP from their Pennsylvania taxable income up to $16,000 per beneficiary, per year. For married couples, contributions up to $32,000 per beneficiary, per year, are deductible, provided each spouse has taxable income of at least $16,000.

Does Pennsylvania have a 529 plan?

The Pennsylvania 529 College and Career Savings Program offers two savings plans. The PA 529 Guaranteed Savings Plan (GSP) is a lower-risk plan that helps your savings keep pace with rising higher education tuition. The PA 529 Investment Plan (IP) lets you choose from several investment options from The Vanguard Group.

How much can you contribute to PA 529?

Pennsylvania taxpayers can deduct from their state taxable income up to $16,000 in contributions to 529 plans per beneficiary per year, or $32,000 if they’re married filing jointly and each spouse has an income of at least $16,000. The maximum contribution limit per beneficiary is $511,758 as of 2022.

Can I use my PA 529 out of state?

For higher education, the money in your PA 529 account may be used at any eligible higher education institution in the United States and abroad that qualifies under federal guidelines.

Who runs the PA 529 plan?

the Pennsylvania Treasury Department
Pennsylvania’s 529 Investment Plan is managed by the Pennsylvania Treasury Department with recordkeeping and investment services provided by Ascensus College Savings and The Vanguard Group respectively.

Can I roll a 529 plan into an IRA?

Rollovers from a 529 plan to retirement plans (such as an IRA) are not allowed. You cannot change the beneficiary of a 529 account funded with custodial assets.

Are PA 529 withdrawals taxable?

In general, qualified distributions from a 529 plan will be exempt from both Federal and Pennsylvania income taxes.

What happens to 529 if child goes out of state?

You are not required to change or terminate your 529 plan if you move to another state. You can keep the 529 plan in the same state. The main difference is that you will no longer be able to claim a state income tax deduction or tax credit based on contributions to the previous state’s 529 plan.

What happens to 529 if you move?

Even if you’ve moved to a new state, you might not need to transfer your 529 plan to that state. You can keep the money in the old state’s 529 plan. A 529 plan can be used to pay for college in any state.