Can I deduct Ser EE US savings bond contributions rolled over into my Wisconsin 529 plan as a Wisconsin taxable income subtraction, just like regular cash contributions?

Forum|Forum|2 years ago
March 11, 2024
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Best answer by Hal_Al

Q. So that means I should be able to be file an amended 2020 return and deduct up to the limit allowed for that year and then use what it is left as a carryover deduction to an amended 2021 WI State Return?

A. Yes & yes.

Hal_Al

Employee

Yes, but only the principal, not the interest. For example, you have a $10,000 USSB that is now worth $7000 when you roll it over to a Wisconsin 529 plan. You may deduct only the $5000* you bought the bond for.

Reference: https://dfi.wi.gov/Pages/EducationalServices/CollegeSavingsCareerPlanning/CollegeSavingsProgram.aspx

*You would deduct the maximum $3860 and roll over the other $1140 to next year.

TopMenAuthor

Thank you. I though this might be the case.

In 2020, I cashed in $9008 total value of USSB where $4000 of the total was the original principal and rolled the whole $9008 into a 529 plan for my daughter. I did not treat that $4000 as a tax deductible contribution.

So that means I should be able to be file an amended 2020 return and deduct up to the limit allowed for that year and then use what it is left as a carryover deduction to an amended 2021 WI State Return? I think that would get me a some more refund back if went through the trouble of doing two amended returns for those two years?

Thank you so much for your help!