December 31 Deadline for 2013 College Savings Deduction

RICHMOND, VA--(Marketwired - December 17, 2013) - Time is running out for Virginia taxpayers to earn a 2013 state income tax deduction for contributions to their Virginia529 college savings accounts. Contributions must be made by December 31, 2013 to qualify. 

Virginia taxpayers may deduct contributions up to $4,000 per account per year; no dollar limit exists for taxpayers age 70 (by December 31) and above. Taxpayers with multiple accounts (including couples filing jointly) may deduct up to $4,000 in contributions to each Virginia529 account. Excess contributions may be deducted in subsequent years. The deduction applies to contributions made to any Virginia529 program -- prePAID, inVEST, CollegeWealth and CollegeAmerica.

"This is a great time of year to make a contribution to your account or that of a family member or friend," said Mary Morris, Virginia529 CEO. "Whether maximizing your state income tax deduction or just making a lasting gift of education, contributions to a 529 college savings account make wonderful and simple gifts." 

Grandparents, other family members and friends have two options to gift contributions to a beneficiary: open Virginia529 accounts in their own names or contribute to another owner's account using printable gift certificates available new this year. However, Morris noted that only account owners can deduct Virginia529 contributions from state income tax.

In addition to the state tax benefits, 529 accounts are afforded several federal tax advantages as well. The best known advantage is that earnings on 529 accounts are not subject to tax -- federal or state -- when used for qualified higher education expenses. 

Contributions up to $14,000 a year ($28,000 for couples) generally are exempt from federal gift tax reporting. With accelerated gifting options, an individual can contribute as much as $70,000 ($140,000 per couple) per beneficiary by combining five years of gifts into a single contribution. Contributions to 529 accounts are completed gifts for estate tax purposes, but the account owner retains control of the account. 

Virginia529 accepts applications for new accounts and payments for new and existing accounts online at Virginia529.com, by mail or in person at the agency's office in Chesterfield. Visit Virginia529.com for more information, addresses and December office hours.

About the Virginia529 College Savings Plan:
Virginia529 is a 529 college savings plan that offers flexible, affordable, tax-advantaged savings for qualified higher education expenses through its four programs: Virginia529 prePAID (SM) (prePAID (SM)), Virginia529 inVEST (SM) (inVEST (SM)), CollegeAmerica® and CollegeWealth®. More than $47 billion in assets under management and 2.3 million accounts as of November 30, 2013 make Virginia529 the largest 529 plan available. For more information on Virginia529's college savings options, visit Virginia529.com.