State Treasurer Michael L. Fitzgerald wants to remind Iowa taxpayers that there’s still time to contribute to their College Savings Iowa accounts for 2017 and claim a tax deduction by investing them in College Savings Iowa. “Iowa taxpayers may elect to contribute to their College Savings Iowa account up through the tax deadline for filing an individual Iowa state income tax return, which is April 30, 2018,” said Fitzgerald. “Iowans can open a new College Savings Iowa account, or contribute to their current accounts, and still receive the 2017 Iowa state tax deduction of up to $3,239 per beneficiary account.”
Treasurer Fitzgerald also wants to encourage Iowa tax payers to make the most of their federal and state tax refunds. “Your tax refunds provide a great opportunity to open a new College Savings Iowa account or contribute one of your already existing accounts,” added Fitzgerald. “For the 2018 tax year, Iowa taxpayers can deduct contributions up to $3,319 per beneficiary from their 2018 adjusted gross income.”*
College Savings Iowa is designed to provide families a tax-advantaged way to save money for their children’s higher education. It only takes $25 to open an account, and anyone – parents, grandparents, friends and relatives – can invest in College Savings Iowa on behalf of a child. Earnings grow tax free and investors can withdraw their investment federally and Iowa state tax-free to pay for qualified higher education expenses including tuition, books, supplies and certain room and board costs at any eligible college, university, community college or accredited technical training school in the United States or abroad.**
Saving for a child’s education is always a smart investment, and College Savings Iowa is there to help. To learn more about College Savings Iowa or to open an account, please visit CollegeSavingsIowa.com or call 1-888-672-9116.
*Adjusted annually for inflation. If withdrawals are not qualified, the deductions must be added back to Iowa taxable income. The availability of tax or other benefits may be contingent on meeting other requirements.
**Earnings on non-qualified withdrawals may be subject to federal income tax and a 10% federal penalty tax, as well as state income taxes. The availability of tax or other benefits may be contingent on meeting other requirements.