Which states give the biggest tax breaks for 529 contributions, and do any offer no benefit?
State treatment varies widely. Most states with an income tax offer a deduction or credit for 529 contributions, though usually capped (commonly a few thousand dollars per year). A handful of "tax-parity" states, such as Arizona, Kansas, Minnesota, Missouri, Montana, and Pennsylvania, let you deduct contributions to any state's plan, not just their own. A few states, including Indiana and Utah, offer a tax credit rather than a deduction. States with no income tax, like Texas, Florida, and Nevada, offer no state deduction because there is nothing to deduct against. Because rules change and caps are adjusted, verify your own state's current benefit before choosing a plan. The in-state break often outweighs small fee differences elsewhere.
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