Saving for college is always a good idea. But now there’s an opportunity to benefit even more from setting aside funds to pay for your son or daughter’s higher education costs. Beginning with the 2017 tax year, Massachusetts has enacted a state tax benefit for those individuals saving in a designated college savings account. You have endless reasons to save for college, but this is our new favorite. Here are the details:
- Individuals can take a deduction on their Massachusetts state income tax return for any amount contributed into a Massachusetts college savings account up to $1,000 for single filers and $2,000 for married filers
- Contributions to both Massachusetts savings plans – the U.Fund College Investing Plan and the U.Plan Prepaid Tuition Program – count toward the deduction
- The deduction becomes available January 1, 2017 for the 2017 tax year
- Only the account owner is eligible for the tax deduction
Research shows that students with a college savings account may be 7 times more likely to attend college.* Saving for college also opens doors by providing students with greater opportunities for education and more choices when it comes to selecting a school. And remember, every dollar saved toward a college education is a dollar your family won’t have to borrow (and repay with interest) later on. If you’d like some guidance on saving for college and opening a college savings account, we’re happy to help. Reach out to one of our college savings experts at (800) 449-MEFA (6332) or firstname.lastname@example.org.