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  • Vest Distribution Request Form - Virginia529 College Savings Plan

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InVEST DISTRIBUTION REQUEST FORM INSTRUCTIONS Use this form to request a distribution from your inVEST account. Complete one distribution request form for each individual payee and each individual.

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529 plans offer unsurpassed income tax breaks. Although contributions are not deductible, earnings in a 529 plan grow federal tax-free and will not be taxed when the money is taken out to pay for college.

You may contribute to a 529 plan at any time throughout the year, and you do not have to stop making contributions once the beneficiary reaches a certain age. But, some families may want to complete their annual contributions by a specific date to maximize state income tax benefits and the annual gift tax exclusion.

529 Mechanics As long as no additional contributions to that beneficiary are made within that five-year window, no gift tax filing obligations are required. Money contributed does not receive a tax deduction at the federal level.

Divide the AQEE by the total 529 plan distribution (Form 1099-Q, Box 1) Multiply the answer by the earnings portion of the total distribution (Form 1099-Q, Box 2). Subtract this amount from the total distributed earnings.

Currently over 30 states, including the District of Columbia offer a state income tax deduction or credit for 529 plan contributions. Most states have a December 31 contribution deadline to qualify for a 529 plan tax deduction, but taxpayers in the states listed below have until April.

Introduction. If you contribute money to a qualified tuition program, such as a 529 plan or a Coverdell ESA, you will likely receive an IRS Form 1099-Q in each year you make withdrawals to pay school expenses of the beneficiary.

If assets in a 529 are used for something other than qualified education expenses, you'll have to pay both federal income taxes and a 10 percent penalty on the earnings. (An interesting side note is that if the beneficiary gets a full scholarship to college, the penalty for taking the cash is waived.)

The result must be reported as income on the beneficiary's or the account owner's federal income tax return, Schedule 1 Form 1040, line 8 or Form 1040NR, line 21. If the distribution is subject to the 10% penalty tax, the additional tax must be reported on Schedule 2 (Form 1040), line 6, or Form 1040NR, line 57.

Parents can withdraw 529 plan funds by completing a withdrawal request form online. Some plans also allow 529 plan account owners to download a withdrawal request form to be mailed in or make a withdrawal request by telephone. If possible, avoid making the distribution payable to the account owner.

529 plans do not have annual contribution limits. However, contributions to a 529 plan are considered completed gifts for federal tax purposes, and in 2019 up to $15,000 per donor, per beneficiary qualifies for the annual gift tax exclusion.

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© Copyright 1997-2025
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Form Packages
Adoption
Bankruptcy
Contractors
Divorce
Home Sales
Employment
Identity Theft
Incorporation
Landlord Tenant
Living Trust
Name Change
Personal Planning
Small Business
Wills & Estates
Packages A-Z
Form Categories
Affidavits
Bankruptcy
Bill of Sale
Corporate - LLC
Divorce
Employment
Identity Theft
Internet Technology
Landlord Tenant
Living Wills
Name Change
Power of Attorney
Real Estate
Small Estates
Wills
All Forms
Forms A-Z
Form Library
Customer Service
Terms of Service
DMCA Policy
About Us
Blog
Affiliates
Contact Us
Privacy Notice
Delete My Account
Site Map
All Forms
Search all Forms
Industries
Forms in Spanish
Localized Forms
Legal Guides
Real Estate Handbook
All Guides
Prepared for You
Notarize
Incorporation services
Our Customers
For Consumers
For Small Business
For Attorneys
Our Sites
US Legal Forms
USLegal
FormsPass
pdfFiller
signNow
airSlate workflows
DocHub
Instapage
Social Media
Call us now toll free:
1-877-389-0141
As seen in:
  • USA Today logo picture
  • CBC News logo picture
  • LA Times logo picture
  • The Washington Post logo picture
  • AP logo picture
  • Forbes logo picture
© Copyright 1997-2025
airSlate Legal Forms, Inc.
3720 Flowood Dr, Flowood, Mississippi 39232