College plan tax deadline looms

Published 7:48 pm Friday, December 26, 2014

State officials are reminding parents and other Virginians that the deadline to make tax-deductible contributions to Virginia529 college savings accounts for 2014 is fast approaching.

The deadline for contributions this year to be eligible for a 2014 state individual income tax deduction is Wednesday.

Account owners under age 70 can deduct contributions up to $4,000 per account per year. Excess contributions may be deducted in subsequent years.

Email newsletter signup

Account owners age 70 and above by Dec. 31 may deduct all contributions made this year.

Nathan Rice, the relationship manager at ABNB Federal Credit Union in downtown Suffolk, said the earlier parents start saving for college the better.

Not only will more contributions be made if they start early in a child’s life, but those funds will have longer to accumulate interest, he said.

“It makes a big difference starting early,” Rice said.

When a child reaches the age when he or she starts looking at prospective colleges, parents who set up a college savings account when the child was born, and contributed regularly over the years, will be glad for it, he added.

“Rather than having to worry and stress about how they are going to afford ever-increasing college expenses, they have at least a base on which to build,” Rice said.

Parents not only benefit from the tax advantages in the years they contribute to a plan, he said, but they and the child won’t have to borrow as much — or maybe at all — to cover college expenses, he said.

“Any time you borrow, you have to pay that back with interest,” Rice noted.

The deduction applies to contributions made to any Virginia529 program.

Officials also remind family and friends they may give the gift of education by using Virginia529 gift certificates, available online at

Perfect for last-minute shoppers, officials say, the printable certificates include designs for Christmas, Chanukah, new babies and birthdays. The state income tax deduction is available to the account owner, regardless of who makes the Virginia529 account contribution.

“With a Virginia529 gift certificate, one never has to worry about picking the right size or color,” Virginia529 CEO Mary Morris stated.

“Education savings also send a message that the gift giver believes in the child’s future and supports his or her career dreams.”

Visit for more information, addresses and office hours.

At the end of September, Virginia’s plan for tax-advantaged college savings had more than $52 billion in assets under management and 2.3 million accounts.

For more information on Virginia529’s college savings options, visit or call 1-888-567-0540 for program materials.

Available is information on Virginia529 programs, investment objectives, risks, charges, expenses and other important factor.

Folks are encouraged to read and consider the available information carefully before investing, as all investments are subject to risk, including the possible loss of the money.