How do I Report my 529 Plan for New Mexico?

If you contributed to the 529 plan, you may be able to claim a Subtraction from Income. If you withdrew money from your 529 plan, you may have to 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, room and board, books, computers and fees.
• Public and private universities, community college, vocational school, graduate and professional programs (including medical and law schools)
• Any accredited public or private post-secondary school in the U.S. and some schools abroad
• Extra expenses for special needs students including: a classroom aide, wheelchair, special technology and remedial tutoring. 
• K-12 tuition or transfer to an ABLE account. When you need to withdraw savings to pay for tuition or other qualified expenses, just fill out a simple form and the payment will be made to the educational institution, account owner or beneficiary as you direct.

What about rollovers? 

Families can roll over unused 529 plan funds in a Roth IRA account for the beneficiary if the following are true:

• The 529 account must have been open for more than 15 years and the rollover amount must have been in the 529 account for at least 5 years. 
• There is a lifetime rollover limit of $35,000 for each 529 account beneficiary. 
• Rollovers can only be made to the Roth IRA account owned by the named 529 account beneficiary. 

Note: Rollovers from your New Mexico 529 plan to another state's plan will be considered a nonqualified contribution and is subject to tax.

What if I don’t use it for educational expenses?

Nonqualified distributions must be reported as an Addition to Income within the State section of the program. You will need to report nonqualified distributions by going to:

1. State Section
2. Three dots to edit the New Mexico State return
3. Additions to Income
4. Contributions Refunded from the NM Education Trust Fund

Where do I enter contributions?

1. State Section
2. Three dots to edit the New Mexico State return
3. Deductions from Income
4. Deductions for contributions to NM Education Trust Account

For more information please visit: NM College savings