The bill amends sections 5747.70 and 5747.78 of the Revised Code to modify the income tax deductions for contributions to 529 plans and ABLE accounts. It establishes a new annual contribution limit for these deductions, which is set at eight thousand dollars for taxpayers filing jointly and four thousand dollars for all other taxpayers starting in 2025. The bill also allows for adjustments to these limits in subsequent years based on the gross domestic product deflator, ensuring that the limits can increase over time. Additionally, it clarifies that if contributions exceed the annual limit, the excess can be carried forward to future taxable years until fully deducted.

The bill removes previous language that specified the deduction limits for taxpayers and their spouses, streamlining the process by tying the annual contribution limit directly to the number of beneficiaries. It also redefines the term "annual contribution limit" to align with the new provisions in section 5747.70. Overall, the changes aim to enhance the tax benefits associated with saving for education and disability expenses through these accounts while providing a clearer framework for taxpayers.

Statutes affected:
As Introduced: 5747.70, 5747.78
As Reported By House Committee: 5747.70, 5747.78
As Passed By House: 5747.70, 5747.78