Need help understanding Oregon 529 changes for 2020

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axesofevil
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Joined: Tue May 19, 2015 5:55 pm

Need help understanding Oregon 529 changes for 2020

Post by axesofevil » Thu Nov 07, 2019 1:52 pm

In Oregon, the 529 Tax deduction is being eliminated and replaced with a tax credit.
For high income earners, this seems to mean that I could get ~$480 tax reduction in 2019 for a $4865 contribution vs a $300 tax credit in 2020 with a $6000 contribution. The effective tax savings goes from 10% in 2019 to 5% in 2020.

However, the OCSP website (https://www.oregoncollegesavings.com/fa ... s-tax-year) says:
You may carry forward the balance over the following four years for contributions made before the end of 2019. For example, if a couple contributed $15,000 to their son’s Oregon College Savings Plan account in 2019, they may subtract a maximum of $4,865 (because they file jointly) on their 2019 Oregon taxes. They can then carry forward the remaining $10,135 balance of that contribution for up to four years. The new tax credit would be in addition to any carried forward deductions.
What I don't understand is how much of a deduction would I get on the carry-forward amount in 2020-2023? Can I continue to deduct $4865 from my taxes for the next 4 years (assuming I contribute a sufficient amount this year)?

Also, what does:
The new tax credit would be in addition to any carried forward deductions
mean? I guess it means that I could choose to contribute an additional $6000 in 2020 (on top of whatever I carry forward) and receive an additional $300 tax back?

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