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lafiosca
Level 2

Since when is the maximum value 5000 for 529 account contributions (for higher education expense purposes)? I contributed $6,000, but TT won't allow more than 5000...?

 
4 Replies
Hal_Al
Level 15

Since when is the maximum value 5000 for 529 account contributions (for higher education expense purposes)? I contributed $6,000, but TT won't allow more than 5000...?

 There is no federal deduction for making a contribution to a 529 plan. Some states allow a deduction on the state return. If your state is one, it will come up in the state interview; usually in the "Here's how (your state) handles income differently" section.  Turbotax will limit you to your state's deduction limit, For a list, see:

http://www.savingforcollege.com/compare_529_plans/index.php?page=compare_plan_questions&plan_questio...

lafiosca
Level 2

Since when is the maximum value 5000 for 529 account contributions (for higher education expense purposes)? I contributed $6,000, but TT won't allow more than 5000...?

Thank you very much.  

Indeed, my State (Indiana) does give a 20% for 529 contributions up to the first $5,000.  It's wonderful.

I was just perplexed as to why TurboTax software would prevent me from typing in a contribution figure greater than $5,000.  I was expecting the software to cap the amount when it is calculating the allowable credit.

Nevertheless, thank you very much for your time.

questionperson2021
Returning Member

Since when is the maximum value 5000 for 529 account contributions (for higher education expense purposes)? I contributed $6,000, but TT won't allow more than 5000...?

I contributed to the Indiana 529 plan and had the exact issue as lafiosca . It seems that the field limitations in the TurboTax form need to be adjusted to allow entries greater than $5,000.

JohnW152
Expert Alumni

Since when is the maximum value 5000 for 529 account contributions (for higher education expense purposes)? I contributed $6,000, but TT won't allow more than 5000...?

@questionperson2021

The way Schedule IN-529: Indiana’s CollegeChoice 529 Education Savings Plan Credit form, found at 2021 Individual Income Tax Forms - DOR, is laid out, even if an amount of over $5,000 is entered, the maximum allowable credit amount would be $1,000, $500 if married filing separately.  

That’s because the allowable credit rate is 20% of the contribution amount, up to a maximum of $1,000 (or $500). 

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