Wisconsin 529 Tax Benefits: Save $2,350 on Your Child's Education

Maximize Your Wisconsin 529 Plan

Wisconsin offers generous tax benefits for 529 plan contributions, making it one of the most advantageous states for educational savings. Here's how you can leverage these benefits to maximize your child's financial future:

Wisconsin 529 Plan Overview

A 529 plan is a tax-advantaged savings account designed to help families save for college expenses. Contributions to Wisconsin's 529 plan, known as Edvest, are tax-deductible up to $4,000 per beneficiary per year ($8,000 for married couples filing jointly).

Tax Deduction Benefits

• State Income Tax Deductions: Wisconsin taxpayers can deduct up to $4,000 per beneficiary per year, reducing their taxable income. This deduction is available for both federal and state income taxes.
• Dollar-for-Dollar Savings: For every $1,000 you contribute to your Edvest 529 plan, you save $100 on your Wisconsin state income taxes.
• Example: If you contribute $4,000 to an Edvest 529 plan for your child, you will reduce your Wisconsin state income taxes by $400.

Earnings Growth and Tax-Free Withdrawals

• Tax-Free Earnings: Contributions and earnings in your Edvest 529 plan grow tax-deferred, meaning you won't pay taxes on any investment gains until you withdraw the money.
• Tax-Free Withdrawals: Withdrawals from your Edvest 529 plan are completely tax-free if used for qualified education expenses, such as tuition, fees, books, and room and board.

Long-Term Savings Potential

The tax benefits and tax-free growth of Edvest 529 plans can significantly boost your child's college savings over time. According to data from the College Board, the average cost of tuition and fees at a four-year public university in Wisconsin is $7,192 for in-state students and $23,582 for out-of-state students. By maximizing the Wisconsin 529 tax benefits, you can accumulate a substantial amount of money to help cover these expenses.

Example: If you contribute $4,000 per year to an Edvest 529 plan for your child over 18 years, you will have contributed $72,000. Assuming an average annual investment return of 6%, your child's Edvest 529 plan will grow to approximately $191,662 by the time they start college. The tax savings from the Wisconsin 529 tax deduction alone will have totaled $2,350 over 18 years.

How to Contribute to Edvest 529

• Online: You can open an Edvest 529 account and contribute online at edvest.com.
• Mail: You can download a contribution form from the Edvest website and mail it with your contribution to the following address: Edvest P.O. Box 7840 Madison, WI 53707-7840.
• Phone: You can call Edvest at 1-888-338-3788 to contribute over the phone.

Tips for Maximizing Your Savings

• Start Saving Early: The earlier you start saving, the more time your money has to grow tax-deferred.
• Contribute Regularly: Even small monthly contributions can make a big difference over time.
• Take Advantage of Matching Funds: Some employers offer matching funds for 529 plan contributions.
• Consider Additional State Benefits: Wisconsin's Edvest 529 plan offers additional benefits, such as the EdVest Investment Grant Program, which can provide up to $250 in matching funds for eligible families.

Conclusion

Wisconsin's 529 tax benefits make it an excellent option for families looking to save for their children's education. By taking advantage of the state income tax deduction and tax-free growth, you can maximize your savings and help your child achieve their academic goals. Start contributing to Edvest 529 today to secure your child's financial future.

529 Plan Comparison: Wisconsin vs. Other States

Savings Projections: Edvest 529 Plan

Tax Savings Calculator: Wisconsin 529 Deduction

Frequently Asked Questions about Wisconsin 529 Tax Benefits

Am I eligible for the Wisconsin 529 tax deduction?

You are eligible for the Wisconsin 529 tax deduction if you are a Wisconsin resident and file a Wisconsin state income tax return.

What expenses are eligible for tax-free withdrawals from an Edvest 529 plan?

Eligible expenses include tuition, fees, books, supplies, and room and board at qualified educational institutions.

Can I contribute to an Edvest 529 plan for a child who lives out of state?

Yes, you can contribute to an Edvest 529 plan for any child, regardless of where they live.