Tuesday, December 15, 2015

Need a Gift Idea?

Cathy Robinson, CPA
Senior Manager

How about starting or contributing to a 529 College Savings Plan account?

You can set up a Plan operated by a state or state agency and name anyone as a beneficiary.  The contributions cannot exceed the amount necessary to provide for the qualified education expenses.  Remember, any gifts in excess of $14,000 will be taxable.  Since you will be the purchaser, you will control the funds until they are withdrawn for educational expenses.

The earnings from a 529 Plan are not subject to Federal taxes and may not be subject to state tax if the money is used for educational expenses for college.  For the state of Ohio, $2,000 per beneficiary can be deducted on the individual income tax return and any excess can be carried forward to deduct in future years.

So again, I ask, need a gift idea? Getting started on affording a college education is something you or your beneficiary will not forget.