Washington D.C. Extends 529 Tax Deductions to $4,000 Per Person
Washington D.C. is making contributing to a 529 college savings plan even a smarter idea. The D.C. city council has voted to increase the tax deduction limit to $4,000 per person. That means that people who contribute to a 529 plan can deduct up to $4,000 of their annual contribution from their Washington D.C. income taxes.
Of course, everyone still gets the federal income tax break. This break lets you withdraw money for qualified education expenses without paying taxes on the investment earnings.
We have updated our Washington D.C. 529 profile to reflect the new tax deduction.