TurboTax providing incorrect info re AZ deductions for 529 contributions
The help function is providing incorrect information regarding whether Arizona provides a state income tax deduction for 529 plan contributions. No matter how the question is phrased it states: "Arizona does not provide a state income tax deduction or credit for contributions made to 529 plans. Contributions to 529 education savings plans are not deductible on your Arizona state return, although the earnings grow tax-free federally when used for qualified educational expenses. Therefore, no direct state tax benefit applies for 529 plan contributions in Arizona. The primary tax advantage of 529 plans for Arizona residents is the federal tax treatment of earnings and qualified withdrawals, not a state deduction or credit." This is incorrect and may cause people to miss the deduction. Arizona provides an income tax deduction for contributions made to any state’s 529 plan up to a certain amount.
