1. May I claim a subtraction for a contribution to a college savings account in a state other than Wisconsin?

  2. May a person claim the subtraction from income for an amount rolled over from a college savings account in another state into a Wisconsin college savings account?

  3. May a person claim the subtraction from income for an amount rolled over from one Wisconsin college savings account to another?

  4. Does the annual limit for the college savings account subtraction apply to the owner of the account or to the beneficiary?

  5. Can I claim a subtraction for a contribution to a college savings account where I am both the owner of the account and the beneficiary?

  6. Excess contributions for 2014 can be carried forward and subtracted in a later year. Does this apply to pre-2014 excess contributions?

  7. Who adds an amount to income when a distribution was not used for qualified higher education expenses?

  8. Is a nonresident of Wisconsin required to include in Wisconsin income the amount of a distribution rolled over to a college savings account in another state?

  9. As a practitioner, how will I know whether an Edvest account has been transferred to another state?


  1. May I claim a subtraction for a contribution to a college savings account in a state other than Wisconsin?

    No. The Wisconsin subtraction for contributions to a college savings account only applies for contributions to a Wisconsin college savings account. The subtraction does not apply for contributions to a college saving account in any other state. The qualified Wisconsin college savings accounts are Edvest and Tomorrow's Scholar.

  2. May a person claim the subtraction from income for an amount rolled over from a college savings account in another state into a Wisconsin college savings account?

    For the 2014 and prior taxable years, the department will allow rollover amounts to be claimed as a subtraction from income (subject to applicable yearly limitations). Rollovers made for the 2014 taxable year on or before April 15, 2015 that were in excess of the amount allowed as a subtraction in 2014 may be carried forward to future years and claimed as a subtraction subject to the yearly limitations. Taxpayers may amend their 2014 tax returns to claim a subtraction from income for a rollover amount if they have already filed their returns and did not report the amount from the rollover on line 2 of Schedule CS.

    For the 2015 and following taxable years, rollovers of the principal amount into a Wisconsin college savings account are eligible for the subtraction from income.

  3. May a person claim the subtraction from income for an amount rolled over from one Wisconsin college savings account to another?

    For the 2014 and prior taxable years, the department will allow rollover amounts to be claimed as a subtraction from income (subject to applicable yearly limitations). Taxpayers may amend their 2014 tax returns to claim a subtraction from income for a rollover amount if they have already filed their returns and did not report the amount from the rollover on line 2 of Schedule CS.

    For the 2015 and following taxable years, rollovers from one Wisconsin college savings account into another Wisconsin college savings account are not eligible for the subtraction from income. A rollover is not eligible for the subtraction from income since the amount of the rollover is not included in federal adjusted gross income. Note: This supersedes guidance in Wisconsin Tax Bulletin 128 in January 2002. Rollovers made for the 2014 taxable year on or before April 15, 2015 that were in excess of the amount allowed as a subtraction in 2014 may be carried forward to future years and claimed as a subtraction subject to the yearly limitations.

  4. Does the annual limit for the college savings account subtraction apply to the owner of the account or to the beneficiary?

    The 2016 annual subtraction for contributions to a Wisconsin college savings account is $3,100 ($1,550 if married filing separate or a divorced parent). This limitation applies to the person who makes a contribution to the account. A beneficiary may have multiple contributions made to their account for the year and the total of all contributions may exceed $3,100.

  5. Can I claim a subtraction for a contribution to a college savings account where I am both the owner of the account and the beneficiary?

    Yes. Your contributions into a college savings account are eligible for a Wisconsin subtraction even if you are both the owner and beneficiary of the account.

  6. Excess contributions for 2014 can be carried forward and subtracted in a later year. Does this apply to pre-2014 excess contributions?

    No. The carryover provisions do not apply to pre-2014 excess contributions.

  7. Who adds an amount to income when a distribution was not used for qualified higher education expenses?

    According to Edvest.com, only the owner of an account can request distributions. Therefore, the owner of the account must add to income the amount of distributions received on or after June 1, 2014, that resulted in a federal penalty because the distribution was not used for qualified higher education expenses. The amount to be added to income cannot be more than the total dollar amount contributed to the account for 2014 and thereafter.

  8. Is a nonresident of Wisconsin required to include in Wisconsin income the amount of a distribution rolled over to a college savings account in another state?

    The requirement to include an amount in Wisconsin income when a distribution from a Wisconsin college savings account is rolled over to a college savings account in another state does not apply when the distribution is made to a nonresident of Wisconsin. Assuming the nonresident has no other income from Wisconsin sources, the nonresident would not be required to file a Wisconsin income tax return.

  9. As a practitioner, how will I know whether an Edvest account has been transferred to another state?

    According to Edvest.com, the owner of the account will receive quarterly and annual account statements which include withdrawals from the account. Withdrawals include outgoing rollovers into another state's account. In addition, Edvest will annually issue Form 1099-Q to the owner or beneficiary (depending on who received the withdrawal).

FOR MORE INFORMATION PLEASE CONTACT:

WISCONSIN DEPARTMENT OF REVENUE
Customer Service Bureau
PO Box 8949
Madison, WI 53708-8949
Phone: (608) 266-2486
Email: DORIncome@wisconsin.gov

February 7, 2017