District of Columbia 529 tax deduction in 2026
In the District the deduction belongs to whoever owns the account, which changes how a married couple should set up its savings.
District of Columbia tax saved on this contribution
$680
8.5 % of what you put in comes back on your 2026 return.
| Subtracted from state income | $8,000 |
| Your state marginal rate | 8.50 % |
| Cap that applies this year | $8,000 |
| Back per $1,000 contributed | $85 |
District of Columbia: Account owners may deduct up to $4,000 per year of contributions to DC College Savings Plan accounts they own; on a joint return each spouse may deduct up to $4,000 only for accounts he or she owns ($8,000 total); excess carries forward 5 years; rollovers in are not deductible. Read on 2026-10-19. No federal deduction exists for 529 contributions.
| Taxable income | Marginal rate | Tax saved |
|---|---|---|
| $50,000 | 6.50 % | $520 |
| $100,000 | 8.50 % | $680 |
| $200,000 | 8.50 % | $680 |
| $400,000 | 9.25 % | $740 |
Worked out by Radif Partners · How we calculate · District of Columbia rule read on October 19, 2026, brackets of tax year 2026 · not tax advice
A District of Columbia taxpayer can deduct up to $4,000 a year of contributions to DC College Savings Plan accounts that he or she owns. On a joint return each spouse may deduct up to $4,000, but only for accounts that spouse owns, so a couple reaches $8,000 only with two accounts, one in each name. A couple at $175,000 who put $8,000 into a single account owned by one spouse deduct $4,000 and save $340; with two owners the saving is $680. The excess carries forward for 5 years. Only the DC plan counts, and rollovers in are not deductible. Deductions come back into DC income on a nonqualified withdrawal and on a rollover to another state's 529 within 2 years of opening the account. K-12 tuition is qualified for DC, while the wider K-12 costs and credential programs added by the 2025 federal law are still under review by the District.
| Benefit for contributions | Deduction |
|---|---|
| Cap | $4,000 single, $8,000 joint per taxpayer (joint figure only if both spouses contribute or own accounts) |
| Another state’s plan counts | No, in-state plan only |
| Carryforward of the excess | 5 years |
| State plans (official names, no recommendation) | DC College Savings Plan |
| Account balance limit | $500,000 |
| K-12 withdrawals qualified for state tax | Yes |
| 529 to Roth IRA rollover qualified | No |
| Student loan payments qualified | Yes |
| Add-back on a rollover to another state’s plan | Only within 2 years of opening the account |
Ownership decides the deduction
Under D.C. Code 47-4509, the deduction goes to the account owner for contributions to accounts that person owns. A married couple filing jointly does not get a pooled $8,000. Each spouse has $4,000, usable only on his or her own accounts. The couple above shows the effect: one account in one name gives $340; a second account for the same child, in the other spouse's name, brings the total to $680.
The calculator assumes the joint cap is fully usable. If only one of you owns an account, set the contribution to $4,000 to see what actually counts.
Who writes the check matters less than whose name is on the account. The text read for this page grants the deduction to owners only, so a grandparent adding money to a parent-owned account would find no line for it on a DC return.
Carrying the excess
Contributions above the cap carry forward for 5 years. A single owner at $92,000 who contributes $6,500 deducts $4,000 this year, saving $340, and the remaining $2,500 the next, worth another $213. The District applies one rate schedule to every filing status, so a joint return reaches the 8.5 % bracket at the same income as a single one.
DC deduction for one owner
District of Columbia tax saved on this contribution
$340
| Subtracted from state income | $4,000 |
| Your state marginal rate | 8.50 % |
| Cap that applies this year | $4,000 |
| Back per $1,000 contributed | $52 |
The 2-year lock on rollovers
Moving an account to another state's 529 within 2 years of opening it brings the deductions back into the owner's DC income. After that, a rollover to another qualified tuition program is not recaptured. Nonqualified withdrawals are recaptured at any time, except for death, disability or a scholarship. The recapture guide compares this with other states.
K-12: tuition yes, the rest undecided
The plan's K-12 tuition update says K-12 tuition withdrawals are qualified for both federal and DC purposes, within the federal $20,000 yearly cap per child from 2026. The October 2025 supplement adds that the District is still reviewing the other K-12 costs and the postsecondary credential programs added by the 2025 federal law, with no determination of DC tax consequences yet. Paying tutoring or books from the account is therefore a question the District has not answered.
K-12 tuition from a DC account
Tax-free from the 529 this year (federal)
$20,000
| Federal cap per child, 2026 | $20,000 |
| Above the cap | $1,000 |
| Federal tax and 10 % on that part | $96 |
| District of Columbia treatment | Treated as qualified |
Roth rollovers and loans
The Program Disclosure Booklet contains two passages on rollovers to a Roth IRA. The newer one says such a rollover triggers recapture of DC deductions and DC tax on the earnings; an older passage says DC law does not address the question. The newer text is the one shown in the fact table. Student loan repayments appear among qualified expenses in the booklet, though no Office of Tax and Revenue guidance confirms it. The plan stops contributions when a beneficiary's accounts reach $500,000, a figure from the 2022 booklet that later supplements did not change.