Iowa treasurer: Don’t assume college savings can apply to K-12 expenses
BPC Staff Jan 2, 2018 | 5:32 pm
1 min read time125 wordsAll Latest News, Health & Wellness, Law & Government
State Treasurer Michael Fitzgerald is encouraging caution as the state reviews the impact of the federal tax reform bill on Iowa 529 college savings plans. “Iowans may be hearing about the recent change by the federal government to include K-12 tuition as qualified distributions in 529 college savings plans,” Fitzgerald said in a release. “I would advise Iowans not to assume that the federal tax reform bill changes Iowa tax law. I want Iowans to know that it may take an act of the Legislature to extend the Iowa state tax deduction benefit for K-12 tuition in the College Savings Iowa and IAdvisor 529 plans.” If a distribution is not qualified for state tax purposes, it would trigger a deduction recapture under Iowa tax law.