Virginia 529 tax deduction in 2026
The limit attaches to each account rather than to the return, the excess never expires, and owners past 70 skip the limit entirely.
Virginia tax saved on this contribution
$230
0.9 % of what you put in comes back on your 2026 return. Capped: only 4,000 dollars of the contribution count.
| Subtracted from state income | $4,000 |
| Your state marginal rate | 5.75 % |
| Cap that applies this year | $4,000 |
| Back per $1,000 contributed | $9 |
Virginia: Account owner of record may subtract up to $4,000 per Commonwealth Savers Plan account (Invest529, CollegeAmerica, Prepaid529) per year, excess carried forward until fully deducted; owners age 70 or older may deduct the full amount contributed in one year. Read on 2026-10-19. No federal deduction exists for 529 contributions.
| Taxable income | Marginal rate | Tax saved |
|---|---|---|
| $50,000 | 5.75 % | $230 |
| $100,000 | 5.75 % | $230 |
| $200,000 | 5.75 % | $230 |
| $400,000 | 5.75 % | $230 |
Worked out by Radif Partners · How we calculate · Virginia rule read on October 19, 2026, brackets of tax year 2026 · not tax advice
Virginia lets the owner of record of a Commonwealth Savers account (Invest529, CollegeAmerica or the closed Prepaid529) subtract up to $4,000 a year per account from Virginia taxable income. Anything above that carries forward, year after year, until it has all been deducted. An owner aged 70 or older can deduct the full contribution in the year it is made. Because almost every household reaches the 5.75 % bracket, which starts at $17,000 for all filing statuses, the first $4,000 saves $230 for most families. A Richmond nurse at $85,000 who invests a $25,000 bonus deducts $4,000 this year, saving $230, and finishes the rest over 7 returns in all. Other states' plans do not count, and deductions come back as income on withdrawals for anything other than federal qualified higher education costs, death, disability or a scholarship.
| Benefit for contributions | Deduction |
|---|---|
| Cap | $4,000 single, $4,000 joint per account; no limit for an owner aged 70 or older |
| Another state’s plan counts | No, in-state plan only |
| Carryforward of the excess | unlimited years |
| State plans (official names, no recommendation) | Invest529 (direct-sold), CollegeAmerica (advisor-sold), Prepaid529 (closed to new accounts), CollegeWealth (closed to new accounts) |
| Account balance limit | $675,000 |
| K-12 withdrawals qualified for state tax | Yes |
| 529 to Roth IRA rollover qualified | Not stated by the state |
| Student loan payments qualified | Yes |
| Add-back on a rollover to another state’s plan | Not settled by the state text |
Accounts, not households
Code of Virginia 58.1-322.03 grants $4,000 per account per year and gives it only to the owner of record. Two consequences follow. A spouse who is not the owner deducts nothing for that account, whatever the joint return says. And a family can widen the yearly room by holding more accounts: a couple at $140,000 with two children, one account each, can deduct $8,000 on $8,000 of deposits and save $460. The calculator treats each child as one account; enter the number of accounts you own.
Virginia room with several accounts
Virginia tax saved on this contribution
$460
| Subtracted from state income | $8,000 |
| Your state marginal rate | 5.75 % |
| Cap that applies this year | $8,000 |
| Back per $1,000 contributed | $58 |
A carryforward with no expiry
Invest529 states that the excess is carried forward until it is fully deducted. The nurse with the $25,000 bonus claims $4,000 now and the remainder over the next returns, 7 tax years in all, without making any new deposit. Each later slice is worth the rate of that year, which in Virginia has not moved since 1990: the schedule in 58.1-320 is not indexed, so 5.75 % applies above $17,000 of taxable income for single and joint filers alike.
Past 70, no limit
An owner who has reached 70 may deduct the whole amount contributed in one year. A grandfather at $70,000 of taxable income who opens an Invest529 account for a grandchild with $25,000 saves $1,438 at once, instead of spreading the subtraction over 7 years. The rule follows the owner's age, so the grandparent must own the account, not simply write the check to the parents' account.
Commonwealth Savers plans only
The statute lists only contracts and accounts of Virginia's own program. Prepaid529 and CollegeWealth no longer open new accounts, which leaves Invest529, sold directly, and CollegeAmerica, sold through advisors. A family that prefers another state's plan gives up the deduction; the out-of-state plan comparison converts that loss into a fee gap. Accounts for one beneficiary accept money until the balance reaches $675,000, a ceiling the October 1, 2026 Program Description raised from January 1, 2026.
What Virginia Tax has not settled
The recapture clause in 58.1-322.03(7) spares only qualified higher education expenses as defined in federal section 529, death, disability and scholarships. Invest529 treats K-12 costs up to $20,000 a year as qualified and does not classify rollovers to another plan or to a Roth IRA as non-qualified, yet we found no Department of Taxation statement on whether any of these three triggers recapture. Nor did we verify which version of the federal code Virginia conforms to for 2026. Student loan repayments are listed as qualified by the plan. A family planning a K-12 withdrawal or a Roth rollover can ask Virginia Tax before acting; the recapture page shows how other states handle each case.
Virginia deductions that could come back
Virginia tax if the deductions come back
$1,438
| Amount added back | $25,000 |
| Your state marginal rate | 5.75 % |