If you contributed to a South Carolina 529 plan, you may be able to claim a South Carolina 529 deduction on your return. If you withdrew money from your 529 plan, you must add the withdrawal back to your income if it was not used for educational purposes.
What is the 529 plan?
Its main purpose is to help families contend with the future high costs of their children’s or grandchildren’s college or vocational education
What are the qualifications?
- Tuition and fees at an eligible higher education institution;
- Cost of room and board incurred while enrolled at or attending, at least part-time, an eligible higher education institution;
- Books, supplies and equipment (including computers) required for enrollment in or attendance at an eligible higher education institution;
What are the South Carolina 529 tax deduction limits?
South Carolina allows a subtraction from taxable income for eligible contributions to a South Carolina 529 plan, subject to the state’s contribution rules.
Contributions to a single beneficiary, across all 529 accounts, cannot exceed $575,000
You can contribute up to $19,000 per year ($38,000 for married couples)
What about carryovers?
Subject to restrictions. 529 plan accounts accept only cash contributions, so assets in a Coverdell account must be liquidated first to make the transfer.
What if I don’t use it for education expenses?
Earnings on withdrawals for expenses other than qualified education expenses will be subject to ordinary income tax and, in most cases, a 10% federal penalty
Program Entry
- State
- Edit (three dots)
- Subtractions from income
- Contributions to South Carolina Tuition Prepayment Program or South Carolina College Investment Program