Michigan Education Savings Program
How the Michigan Education Savings Program's state tax deduction works, what it saves, the K-12 recapture rule, and a calculator.
MESP Michigan deduction calculator
Michigan education savings program tax deduction
The Michigan Education Savings Program (MESP) is Michigan's direct-sold 529 plan. Individual taxpayers can deduct up to $5,000 of MESP contributions a year from Michigan adjusted gross income, and joint filers up to $10,000. At Michigan's 4.25% flat rate that's worth up to $212.50 ($425 joint). Earnings are free of federal and Michigan tax when used for qualified education costs.
Watch out for K-12 withdrawals
Federal law lets 529 money pay K-12 tuition, but for Michigan taxpayers those withdrawals are subject to recapture of the Michigan deduction and state tax on the earnings (MESP). Plan around college costs if you want to keep the state benefit. Project growth with the 529 calculator.
Common questions
How much can I deduct for MESP?
Up to $5,000 a year, or $10,000 married filing jointly.
Are MESP K-12 withdrawals tax-free in Michigan?
No, Michigan recaptures the deduction and taxes the earnings.
Sources
More savings and interest calculators: Iowa529 (ISave 529) · NY529
Related
General information, not financial, tax or legal advice. Check important numbers with the official source before acting on them.