Indiana 529 Credit Updates

Effective 2023, Indiana has increased the state tax credit available for contributions to an Indiana CollegeChoice 529 account.  The credit has increased from $1,000 ($500 for married filing separately) to $1,500 ($750 for married filing separately). The credit is equal to 20% of the contributions into a CollegeChoice 529 for the year up to the maximum credit.

Previously, if you contributed $5,000 annually to a CollegeChoice 529, you would get the maximum tax credit of $1,000. Now, to maximize the credit out, you will need to contribute $7,500 annually. The new maximum will apply to any payments made on or after January 1, 2023.

For an overview of the credit please see the Indiana Department of Revenue Bulletin #98, or contact Greenwalt CPAs at 317-241-2999 for more information.