529 savings plans are tax-advantaged investment accounts originally designed to help families pay for college. Under the new tax bill, parents who send their children to private elementary and high schools will have more options when it comes to saving for tuition. The new law expands the definition of qualified education expenses that may be paid from a 529 account to include up to $10,000 of expenses for tuition at an elementary or secondary private, or religious school.
Although contributions to these accounts do not result in a federal tax deduction, many states (including Ohio) do offer a deduction (to qualify for the Ohio deduction, you must use the Ohio plan). The main advantage of these accounts is that the money contributed grows tax free and withdrawals are tax-free if the funds are spent toward qualified education expenses (which includes tuition).
For more information, please contact Chris McCaskey at Flagel Huber Flagel at cmccaskey@fhf-cpa.com or 937- 528-7244.
