529 College Savings Plans - Tax Season - 2017 Tax Year

Sep 19, 2026

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Wealth Solutions Group flyer explains how 529 plan contributions and withdrawals can affect state tax benefits and what taxpayers may need to reconcile on their filings for the 2017 tax year. It covers whether a state offers deductions or credits, whether a state-specific form is required, and typical contribution deadlines. Guidance is provided for reporting gifts via Form 709, rolling over or qualifying withdrawals with 1099-Q, and identifying reportable non-qualified withdrawals and associated taxes.

LanguageEnglish

CategoryGeneral

FormatPDF

Pages2

Reading Time1 min

AccessFree to download

State tax benefits

Claiming deductions or credits

Contribution deadlines

Gifts and reporting requirements

Reporting 1099-Q withdrawals

Qualified vs non-qualified

Federal and state income tax handling

Key IRS forms and publications

WEALTH SOLUTIONS GROUP 529 College Savings Plans – Tax Season! 2017 Tax Year If you contributed to a 529 plan or took a 529 withdrawal last year, you may be eligible to receive a state tax benefit or your may need to reconcile your distributions on your tax filings. This flyer will help you understand when you may need to file a tax form. 529 College Savings Plans Susie Bauer SVP, 529/UIT Manager Jeannette Haen VP, 529/UIT Product & Service Specialist January, 2017 Does my state offer a state tax benefit? Not every state offers a state tax benefit. Most states offer a state tax benefit if you contribute to your in-state 529 plan. Some states offer a state tax benefit if you contribute to your in-state or out-of-state plan. Ask your Baird Financial Advisor for a State Tax Deductions Flyer. You can [also visit](also visit www.savingforcollege.com. On)[ ](also visit www.savingforcollege.com. On)[www.savingforcollege.com](also visit www.savingforcollege.com. On)[. On](also visit www.savingforcollege.com. On) the home page, click on your home state on the state map and then click on plan details next to your selected 529 plan. Do I need to claim my state tax deduction or credit on my state tax return? Yes, if your state offers a state tax deduction or credit make sure you claim the deduction or credit on your state income tax form . This is labeled as a miscellaneous line item deduction or credit. Some states have a specific form that you need to file for the year in which you either made a 529 contribution or took a 529 distribution. What was my deadline to contribute to my 529 for it to qualify as a 2017 contribution? December 31st is the deadline set by most states for a contribution to be completed in 2017. However, some states such as Wisconsin, allow you to contribute up until April 15th of the following year for the prior year’s deduction. Each state sets their tax-year’s contribution deadline. Be sure to follow the specific plans deadline requirement. Ask your Baird Financial Advisor for your state’s year-end contribution deadline. I made a contribution to my grandchild’s 529 account. Do I need to report this as a gift? If you made a 529 contribution exceeding $14,000 in 2017 for any beneficiary (other than to your spouse) you must file IRS Form 709 and elect the 529 5-year gifting. If your gift was $14,000 or less to any one beneficiary you do not need to file Form 709. I withdrew funds from my 529 last year and I’ve received a 1099-Q form. How do I report that? Federal Income Tax: Even when a Form 1099-Q is received you will not have to report anything on your federal income tax return if either of the two conditions is met: 􀂃 You rolled your 529 plan to another 529 plan. A withdrawal that is rolled over within 60 days or prior to yearend, whichever comes first, to another 529 plan does not have to be reported. 􀂃 You took a qualified withdrawal. A withdrawal that is considered a qualified withdrawal does not have to be reported. A qualified withdrawal is generally considered for tuition and fees, books, supplies and computer technology required for enrollment and room and board. What is Reportable? If you withdrew funds and did not roll over the 529 distribution in the allotted time or used the distribution for expenses other than what constitutes a qualified higher education expense, then you will have something to report on either your or the beneficiary’s Federal income tax return. Refer to IRS Publication 970 – Tax Benefits for Education on [www.irs.gov](www.irs.gov for guidance)[ for guidance](www.irs.gov for guidance). Any non-qualified withdrawal is subject to ordinary income tax and a Federal 10% penalty on the earnings portion of the withdrawal. Form 5329 – Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts must be filed with the income tax return to report the 10% additional tax. State Income Tax: Most states typically follow the

FAQs

Does every state offer a tax benefit for 529 plan contributions?

No. Many states offer a benefit when contributions are made to an in-state 529 plan, while some allow benefits for in-state or out-of-state plans. The flyer advises checking with a Baird Financial Advisor for a state tax deductions flyer.

How do I report a 529 withdrawal if I received a 1099-Q?

You may not need to report anything federally if you rolled the 529 to another 529 within 60 days (or prior to year-end) or if the withdrawal was a qualified withdrawal. Qualified withdrawals generally cover tuition, fees, books, supplies, computer technology required for enrollment, and room and board.

When must I file IRS Form 709 for 529 contributions to a grandchild?

If you contributed more than $14,000 in 2017 for any beneficiary other than your spouse, you must file IRS Form 709 and elect the 529 5-year gifting. If the gift is $14,000 or less to any one beneficiary, Form 709 is not required.

Sep 19, 2026

Upload by Adam