ST. LOUIS (KMOX) – Illinois State Treasurer Mike Frerichs is warning families with 529 college savings accounts that federal tax breaks do not apply to Illinois taxes in certain situations.
The federal tax reforms now let families with accounts like Bright Start and Bridge Directions use that money for K-12 private school expenses instead of just for college. But Frerichs says parents going that route aren’t eligible for a state tax break.
“We want to tell families out there that if they want to use their 529 college savings account for a private school, they can do that, but they cannot then claim a tax deduction unless the Illinois general assemble comes back and changes the current state law,” he says.
Frerichs says families that do try to claim a state tax credit risk penalties if an auditor catches it.
Meanwhile, Governor Bruce Rauner is outlining a plan to help revamp the state’s property tax system.
He’s pushing for a law banning legislators from making money as property tax appeals attorneys.
“It’s a conflict of interest. No one who sets tax policy, no one who has an influence to increase taxes on one hand should be in a position here they financially benefit from fighting about property taxes and trying to get them reduced on the other hand,” he says.
In the meantime, the governor is signing an executive order barring lawmakers from arguing tax appeal cases and is, again, calling for voters to have a say via referendum in whether their property taxes go up.