An Act Increasing The Amount Of The Personal Income Tax Deduction For Contributions To State-established 529 Qualified State Tuition Programs.
Summary
SB 113 would amend Connecticut’s income tax deduction for contributions to state-established 529 qualified tuition programs. Under current law, individual taxpayers may deduct up to $5,000 in contributions and joint filers may deduct up to $10,000; the bill would raise those limits to $7,500 and $12,500, respectively.
The measure is intended to encourage greater savings for higher education by making state 529 plans more tax-advantaged. It applies only to contributions to 529 programs established and maintained by the state, and it would change section 12-701a of the general statutes to reflect the higher deduction amounts.
Impact
If enacted, the bill would reduce taxable income for eligible taxpayers who contribute to Connecticut’s state-run 529 college savings plans, potentially lowering state income tax revenue. It would not create a new program, but would expand an existing tax preference and affect taxpayers who save for education through qualifying state tuition accounts.
Sentiment
No committee transcripts or recorded votes were provided, so there is no direct evidence of debate or formal support/opposition in the available record. Based on the bill’s purpose, it appears to be a pro-savings, pro-education tax measure that would likely be viewed favorably by families using 529 plans and by advocates for college affordability.
Contention
The main likely point of contention is fiscal: increasing the deduction would benefit participating taxpayers but could reduce state revenue. Another possible issue is distributional fairness, since the tax benefit would primarily accrue to households able to contribute to 529 accounts, which may raise questions about whether the incentive is targeted broadly enough. No specific objections or supporters are identified in the provided materials.