Where do I enter my Maryland 529 plan contribution? "Answer the Maryland interview questions and continue until Here's the income that Maryland handles differently'."

Please follow these instructions to enter the MD 529 Contributions you made in 2018:

• Login to your return
• Click the "Maryland" tab under the "State" tab near the top of your screen
• Click "Continue" through the screens until you get to "Here's the income that Maryland handles differently"
• Scroll down to the "Education" section
• Click "Start" next to "Maryland College Savings Plan Contributions"
  
• From here you can walk through the TurboTax interview questions to input your MD 529 Contributions

If you have any issues entering your info, please comment below so that I can assist you further.  I just walked through these steps in TurboTax desktop software so it should work for you.

Maryland State generously pays money into 529 plans for eligible students and families.  If you get this state contribution then you cannot take a state tax deduction for personal contributions to 529s.

 

However TT State 2019 asks how much you contributed to 529s and then reduces my Maryland State tax liability even though you can't get a deduction for the personal contribution.  It does ask you how much the state contributed so it definitely knows about the state contribution (and then for some reason also increases the state refund).

 

This all seems incorrect behavior to me.

I don't understand how the program can be correct. I'm entitled to a deduction of $25k (married couple with 5 beneficiaries) but when I input this amount, in the system, my MD tax liability increases by about $1000 vs. when I input a contribution amount of, say, $12,500.  I spoke to a rep (not a tax expert) who was unable to explain this and generally was not helpful.  I thought about upgrading for "expert tax advice" but the cost would be $100 (50 for federal and 50 for state) and I suspect the outcome would be equally unsatisfactory.  At this point, I'm thinking I may have to do my taxes with a professional tax preparer/accountant to ensure I'm getting it right.  

You want to see what the calculations are.  First on the MD summary page ensure at the top of the page the $25K is showing for the Maryland College Savings Plan Contributions category. 

 

1.  Click "Tax Tools" in the left hand menu

2   Click "Tools" in the left hand menu

3   Click "View Tax Summary" in the center screen

4.  Click "Preview my 1040" in the left hand menu

5   Click "MD Tax Summary" in the left hand menu

 

Verify the subtractions from income included the $25K or see what is there.  This will help narrow down where the disconnect may be.

go to State->continue->pick the second one income which says Retirement income, college savings etc and complete it

As I mentioned above, unless they have fixed this issue, there is a bug in that it allows deduction of 529 contributions to Maryland 529 even if you received the Maryland Match.  That doesn't explain the issues that have been posted since my reply above, but is something to take note of.

Hi,

I contributed to a Maryland 529 Plan last year. The plan is owned by a friend of mine and the beneficiary is her daughter, neither of whom I am related to. I am a Maryland resident. Can I claim the deduction on my Maryland taxes for my contribution even if the plan is not mine? I ask because the first question asked when going into the "Maryland College Savings Plan Contributions" is "Do you have one of the College Savings Plans listed above?". I don't have one of the plans personally, but I did contribute to one.

Yes, this link show that a non-family member can receive a tax deduction for their Maryland 529 contributions. See the small print below the graphic. 

 

Here's more info on the Maryland College Investment Plan Tax Benefits.

 

@arnesons2 

 

[Edited 2/23/2025 | 6:20 pm]