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Highlights of 2008 Tax Changes
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Married individuals may each deduct contributions up to $5,000 annually, for a total deduction of up to $10,000. Investment earnings on account are also New York State tax exempt, and are deferred for federal tax purposes. Up to $100,000 can be contributed over the lifetime of all accounts for one beneficiary. Additional contributions can not be accepted if all accounts for the same beneficiary total $235,000.
The funds can be used at a public or private institution of higher education or business, trade, technical or other occupational school, whether or not located in NYS.
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Either the account owner or the beneficiary must be a New Jersey resident when the account is opened. There is a cumulative contribution limit of $305,000 per beneficiary. Qualified withdrawals are exempt from Federal and New Jersey state income tax. The funds can be used at any accredited two or four year college or university in the United States. If student decides to attend a New Jersey undergraduate school, the state will contribute an extra $500 to $1,500 to the account, depending on the number of years of contributions of at least $300 per year ($500 for four years, an extra $250 for every two years after that, up to the maximum $1,500 for twelve years). The first $25,000 in NJBEST savings is excluded from consideration in awarding the beneficiary New Jersey State need-based aid.
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Material
Provided is general in nature and does not, nor is it intended
as a rendering of professional services. Do not act upon information
contained herein without consulting appropriate advice based on
through evaluation of the facts relating to your specific circumstances.
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