MaryK4
Expert Alumni

State tax filing

It is a Colorado subtraction which means you are getting a tax break for it on the Colorado return only. "Paying in" does not mean you pay on the contribution on the federal return, it just means you cannot use tax-free money for the subtraction.  For example, if you did a rollover to a Colorado 529, it would not be taxed on the federal return so you could not subtract it from Colorado income.

 

@motorthings

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