Indiana529
How Indiana's 20% 529 tax credit works, how much you need to contribute for the full $1,500, when it's recaptured, and a calculator.
Indiana529 tax credit calculator
Indiana529 tax credit
Indiana gives a state income tax credit (not just a deduction) equal to 20% of contributions to an Indiana529 account, up to $1,500 a year ($750 married filing separately). That means the first $7,500 you contribute earns the full credit. A credit cuts your tax dollar for dollar, which makes this one of the richest state 529 benefits.
When Indiana takes the credit back
Indiana may recapture the credit (from the account owner) for rollovers to another state's 529 plan, federally nonqualified withdrawals, K-12 tuition at a school outside Indiana, qualified education loan repayments, or rollovers to a Roth IRA, as described in the plan's disclosure booklet. So a 529-to-Roth rollover allowed federally can still cost you the Indiana credit. Project growth with the 529 calculator.
Common questions
How much is the Indiana529 tax credit?
20% of contributions, up to $1,500 a year ($750 married filing separately).
Does a 529 to Roth IRA rollover keep the Indiana credit?
No, Indiana may recapture the credit on rollovers to a Roth IRA.
Sources
More savings and interest calculators: FDIC Insured Amount · Iowa529 (ISave 529) · Maryland529
Related
General information, not financial, tax or legal advice. Check important numbers with the official source before acting on them.