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Physician's Money Digest
August15 2003
Volume 10
Issue 15

COLLEGE FUND LOSSES

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If you invested in a 529 collegesavings plan and the value is nowway below your initial investment,you can't claim the loss as a taxwrite-off unless you close out theaccount, along with any other 529plans you may own. The 529 planlosses are like losses on stocks; youdon't reap any tax benefit from theloss on a losing stock until you actuallysell it. Unlike losses on stocks,though, 529 plan losses come underthe heading of miscellaneousdeductions, which means you canonly write off the amount thatexceeds 2% of your adjusted grossincome. If your child won't begoing to college for 5 years or more,it may make more sense to leave themoney where it is.

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