It is often more advantageous for parents to own the 529 plans for their students, rather than other family members. (Remember, the parents’ assets are assessed at 5.64% above the asset protection allowance, meaning a $10,000 529 plan balance would increase EFC for the FAFSA by a maximum of $564.
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Tax Credits and Deductions
My last post highlighted some of the tax benefits of 529 plans. One of the lesser-known benefits is that 529 plans get preferential treatment on the FAFSA. How? A couple of ways.
Going back through this blog in an attempt to semi-organize it, I realized I never gave an overview of 529 plans and how they work. That would probably explain all the questions I get about them. So, here are some 529 plan basics.
It’s last-minute-tax-questions week! Today’s question: Whose tax return does the 1099-Q go on? Answer: It depends.
You have until April 15 or the date you file your taxes to make a 2014 529 plan contribution, if you are an Oregon resident (or a resident of another state that permits prior-year contributions to be made up until tax filing). But how do you do it? It depends on how you’re making your contribution.