You may be able to double the amount of 529 contributions you can take as income tax deductions!
In Virginia, for example, most 529 account owners can deduct from their state income the first $4k they contribute to a Virginia 529 plan. Great, but no deduction on any amount over $4k. So if a family is contributing $8k/year, they only deduct $4k. But what if...
...each parent owned their own 529? Sure, two accounts instead of one, and maybe that's a bit of extra record-keeping. But if Mom puts $4k into hers and Dad puts $4k into one he owns, they each can deduct $4k.
Not sure why the extra step must be taken, but this is how my tax advisor explains it. Let me know if I can help you optimize on college savings!
An investing and financial strategies blog offered by Gary Partoyan, veteran financial advisor and owner of Potomac Wealth Strategies, LLC.
