Catholic Education Partners

529 Expenses and deductions

K-12 Tuition and 529 Deductions by State

How to Read This Table

K-12 Expenses Allowed: The 2017 Tax Cuts and Jobs Act expanded the allowable uses of funds in a 529 account by allowing up to $10,000 to be spent on K-12 tuition tax-free. However, because of the way this change was enacted (it did not change the definition of qualifying expenses, but instead the tax treatment of K-12 tuition expenses) not all states’ tax laws treat K-12 tuition expenses the same. The 21 states below currently recognize K-12 tuition as a qualifying expense and will not treat distributions as income under state law. States with no income tax are not listed.

Income Tax Deduction: Of the 23 states that allow for K-12 tuition expenses from 529 accounts, sixteen offer a deduction on state income taxes for contributions made to a 529. The deduction is claimed by the contributor on their annual state income tax return. This is a strong encouragement for tuition-paying parents to utilize a 529 account in paying for their child’s education*. Some rules, such as deduction limits and how long funds must be in an account, vary by state. Contributions in excess of $15,000 on an annualized basis to a single student may trigger a gift tax at the federal level. 

State 529 Plan: To claim a deduction on contributions to a 529 plan, most states require a resident to use the state-run 529 plan. We have provided links to the official plans for your convenience.

FAQ Template: CEP has created templates for use by your organization to spread the word to parents and school officials about 529 accounts. Please maintain the CEP logo when amending to suit your needs.

*In deciding to take advantage of this deduction and/or investing in a 529, one should seek the advice of a financial advisor who can offer personalized guidance.