Where do I enter contributions to a 529 plan for tax year 2020? On the Federal and/or Colorado state return. I only see the option to report distributions from a 529.

[paulaieta1]

Using TurboTax Online system.  Search or Help produces no useful information.  Can't Jump to 529 contribution section.  Simply does not appear on Federal or State sections.

[RayW7]

If your state is one of those states that has a 529 plan deduction, TurboTax will prompt you to enter your 529 contributions when you get to the credits/deductions portion of your state tax interview.

Your contribution isn’t tax-deductible on your federal return, but two-thirds of the states do offer an income-tax deduction for contributions. Most require that you contribute to your own state’s plan to get the break (Arizona, Kansas, Maine, Missouri and Pennsylvania allow deductions for contributions to any state’s plan). But each state also has different rules about who can take the deduction for their contributions.

529 plans are tax-advantaged savings plan named after Section 529 of the Internal Revenue Code. The intention of 529 plans is to encourage college savings. Every state and the District of Columbia, and even some educational institutions sponsor a 529 plan. There are two types of 529 plans: college savings plans and pre-paid tuition plans. Investment options, expenses and other specifics vary from state to state.

Pre-paid tuition plans

While states can offer both types of 529 plans, educational institutions can only offer pre-paid tuition plans. With a pre-paid tuition plan, you are effectively purchasing a future education at an in-state public institution at current prices. In some cases, you can also pre-purchase room and board expenses. State governments typically guarantee investments in pre-paid tuition plans, and require either the owner or the beneficiary to be a resident to benefit from the plan.

College savings plans

Your contributions to a college savings plan function somewhat like an Individual Retirement Account. In a college savings plan, the investments you choose are subject to market risk with no guarantee that it will increase in value.

When the student is ready to use the funds for school, you can make tax free withdrawals up to the amount of qualified education expenses. College savings plans typically have fewer limitations in terms of the age or residency of the account owner or beneficiary and does not restrict your use of the funds to schools within your state. Additionally, college savings plans generally have more varied investment choices.

[motorthings]

@Rayw You state that "If your state is one of those states that has a 529 plan deduction, TurboTax will prompt you to enter your 529 contributions when you get to the credits/deductions portion of your state tax interview."

But.....Colorado DOES have a 529 deduction, and I an NOT prompted to enter the 529 contributions in the credits/deductions portion of my CO state interview. Is this a bug in your software, or is there some other action we need to take to be able to enter the information?

@paulaieta1 - have you found a workaround for this?

[MaryK4]

Colorado technically has the 529 Contribution as a SUBTRACTION to income, even though it has the same effect.  See  Income 44: State Tuition Program Contribution Subtraction

Look for the "Here's the income that Colorado handles differently: page in the Colorado tax section. (see below)

@motorthings

[Tur06]

I have been unable to find, on Turbotax, how to deduct the contributions we made in 2020 under the 529 program, despite reading the Income 44 paper cited.  Please help.

[KrisD15]

Are you looking on the State portion? The contributions are not reported nor deducted on the Federal Return. 

[Tur06]

I see it on the State forms, when printed out from Turbotax, but in the software itself, there's no way to input this data.  I view this issue as a Turbotax error that must be corrected - fail that, I will have to submit a paper return to Colorado with pen and ink changes to the Turbotax print-out.  I view that as an embarrassment to Turbotax.
Dave

[paulaieta1]

For the Online product, it's there, hiding in the Income section.   You have to hunt for it.  It's a deduction from Income.  It's not in the Federal section.  But check this out (I learned the hard way); contributions to a 529 are handled as a calendar-year thing, not like an IRA that you can contribute to in April for the previous tax year.   

[DawnC]

A 529 contribution is entered as a subtraction to income on the Colorado state return.   You will be able to enter it on the page that says ''' Here's the income that Colorado handles differently ''.  At the bottom, in the Education section, you can click Start next to ''529 Collegeinvest Program contributions''  @Tur06

[joncatania]

I am having a similar problem trying to find where I enter deductions for Washington, DC.  I tried to chat with support online, and they were giving me information from 2016.  Could you provide the same screen shot where I would enter my 529 contributions for Washington DC?

[Irene2805]

To enter contributions to a 529 plan on your DC return please follow these steps:

1. Go back into your DC return.
2. On the screen, You've Finished Your District of Columbia Return, click the Update box next to Adjustments.
3. Continue to the screen, Deductible Items in DC.  [Screenshot below.]
4. Click the Start/Update box next to DC college savings plan.
5. Enter your contributions on the next screen.

@joncatania

[tpinnow]

I had the same problem.  If you go back to the state download page and click on the edit button next to Colorado it will take you to the section of walking through the changes to Colorado income.  Don't click continue.  Really bad software design.

[meb7]

The Turbo Tax page for Virginia State Taxes only asks if I want to START a contribution and if I say No returns me to the main page.  For Virginia, how do I enter all the contributions I have made to our 529 accounts for our 3 kids.  It's alot of deduction, this is extremely frustrating.  

[AnnetteB6]

As you go through the Virginia return, look for the screen titled "Here's the income that Virginia handles differently".

On that page, there will be a section for Education.  Click Start or Update/Revisit beside Virginia College Savings Prepaid Tuition (section 529) Plan to enter your information.

@meb7

[Mankirk]

Ray,

I live in Maryland and make post-tax contributions to a 529 plan for my teenage son due to a Maryland tax deduction for using a 529 to fund K-12 private education. This year, TurboTax has included the total 529 disbursements for 2020 that were reported on the plan 1099-Q form as additional, taxable income. How do I get that corrected?