529 Plans

Illinois 529 Plan Rules

Illinois's plan is Bright Start. Illinois allows a deduction of up to $10,000 a year, or $20,000 for a married couple filing jointly, across its 529 programs. Illinois does not follow the federal K-12 rules. K-12 withdrawals are nonqualified for Illinois tax: the earnings are taxed and earlier deductions are recaptured.

Plan: Bright Start
State tax break: Illinois allows a deduction of up to $10,000 a year, or $20,000 for a married couple filing jointly, across its 529 programs.
K-12 withdrawals: Taxed by the state
Detail: Illinois does not follow the federal K-12 rules. K-12 withdrawals are nonqualified for Illinois tax: the earnings are taxed and earlier deductions are recaptured.
Maximum balance: $550,000 per beneficiary across all Illinois 529 programs
Federal K-12 limit: $20,000 a year per student

For the federal conditions on tutoring and the full list of K-12 expenses, see Can you use a 529 plan for tutoring?

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The state and federal rules on this page, to share with whoever does your taxes.

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Frequently asked questions

Does Illinois give a tax deduction for 529 contributions?

Illinois allows a deduction of up to $10,000 a year, or $20,000 for a married couple filing jointly, across its 529 programs.

Can I use a Illinois 529 plan for tutoring?

Federal law allows it, but this state taxes K-12 withdrawals. Illinois does not follow the federal K-12 rules. K-12 withdrawals are nonqualified for Illinois tax: the earnings are taxed and earlier deductions are recaptured. Under the federal rule, the tutor cannot be related to the student and must be a licensed teacher, have taught at an eligible educational institution, or be a subject matter expert.

Can I use a Illinois 529 plan for private school or other K-12 costs?

Federal law allows up to $20,000 a year per student for K-12 tuition and the other listed expenses. Illinois does not follow the federal K-12 rules. K-12 withdrawals are nonqualified for Illinois tax: the earnings are taxed and earlier deductions are recaptured.

What is the maximum balance in a Illinois 529 plan?

$550,000 per beneficiary across all Illinois 529 programs.

State rules: Bright Start official documents. Federal rules: IRS Tax Topic 313 and Public Law 119-21. Read October 6, 2026. This page is general information, not tax advice.