Sep
1
Annual Contribution Limit Increased for Tuition Account Program
The Internal Revenue Service announced in October 2008 the annual gift tax exclusion increased from $12,000 to $13,000 for tax years beginning on or after Jan. 1, 2009.
Therefore, for personal income tax purposes, Pennsylvanians may deduct up to $13,000 in annual contributions to Internal Revenue Code Section 529 Tuition Account Program (TAP) plans against taxable income reported for tax year 2009 and beyond.
The deduction limit per taxpayer, per beneficiary is directly tied to the federal annual gift tax exclusion threshold.
The Pennsylvania Department of Revenue will make appropriate revisions to all applicable forms and instructions, and taxpayers will continue to claim deductions for IRC Section 529 Tuition Account Program contributions using PA Schedule O.
