Amends GS 116-209.25 establishing a matching program (the Program) by the State Education Assistance Authority (the Authority) for contributions to the Parental Savings Trust Fund (the Fund) for accounts opened under section 529 of the Internal Revenue Code (new subsection (e1)). The Authority will provide matching contributions of $100 for every $50 contributed by an eligible person, up to $500 per year, with a maximum of $1,500 per qualifying student. Defines eligible person (a qualified parent or interested party who is a resident of North Carolina and has a household income not exceeding 250% of the federal poverty guidelines) and qualifying student (resident of North Carolina who is 14 years of age or younger). Appropriates $180,000 in recurring funds from the General Fund to the Board of Governors of the University of North Carolina for 2025-26 to be allocated to the Authority to fund the Program. Effective July 1, 2025.
Amends GS 105-153.5(b) creating a new tax deduction of up to $2,000 for individuals who file as single and up to $4,000 for a couple filing a joint return (new subsection (12a)), for contributions to an account in the Parental Savings Trust Fund. Requires adding back to adjusted gross income any amounts previously deducted from the Fund if not used for qualified higher education expenses, unless withdrawn due to the death or permanent disability of the beneficiary. Applies to taxable years beginning on or after January 1, 2026.

Statutes affected:
Filed: 116-209.25, 105-153.5
Edition 1: 116-209.25, 105-153.5