Arkansas Residents Can Receive Up To $5,000 From The 529 Tax Deduction
The annual 529 tax benefit is available for parents and grandparents who are taxpayers in Arkansas and who make contributions to the section 529 plan on behalf of their child or grandchild. Arkansas taxpayers receive a $5,000 deduction if they file as single or head of household; married joint filers can receive $10,000. You must be an Arkansas resident to receive the deduction. The federal amount is $12,000 (or $24,000 for married joint filers) per year, per child. Simply stated, you can contribute up to $12,000 without incurring a federal gift tax. Any amount exceeding the 529 gift tax exclusion limit is considered a taxable gift and must be reported on your federal gift tax return.
