What are the income tax advantages of a College Illinois! Prepaid Tuition Program contract?
As long as benefits are used for education, the increased value of a College Illinois! Prepaid Tuition Program plan is 100% exempt from federal and Illinois state income tax. Individuals subject to Illinois state income tax can deduct from their taxable income up to a maximum of $10,000 per year for contributions made toward the purchase of any College Illinois! Prepaid Tuition Program contract.* Married couples filing jointly can deduct up to $20,000 per year.** This state tax deduction reduces the individuals’ adjusted gross income (AGI) by the amount contributed up to $10,000 (or $20,000 for those filing jointly). An annual statement sent by the program to account owners each year in January summarizes the contributions made during the tax year. Illinois tax form IL-1040 requires that Schedule M be attached to take the state tax deduction. More information is available from the Illinois Department of Revenue at http://www.revenue.state.il.us The College Savings Employer Participatio
Related Questions
- Will PACT (Alabama Prepaid Affordable College Tuition Program) funds be deducted from my account balance prior to the initial payment deadline?
- How are the College Illinois! Prepaid Tuition Program plans treated under federal estate tax laws?
- How are College Illinois! Prepaid Tuition Program plans treated under federal gift tax laws?
