Senate · Introduced · 2025-2026 Regular Session

SB 266: "College Success 529 Expansion Act"; enact

Last action February 27, 2025 · Senate Read and Referred

A Georgia Senate bill would let the state's 529 college savings plan set its own maximum account balance instead of a fixed $235,000 cap, and would raise the state income tax deduction for contributions.

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In plain language

Georgia runs a 529-style college savings program called the Georgia Higher Education Savings Plan, which currently stops accepting new contributions to a beneficiary's account once the total balance hits $235,000. This bill removes that fixed dollar cap and instead lets the plan's governing board set a 'reasonable maximum amount' based on current and anticipated education costs. The bill also increases the state income tax deduction for contributions to these accounts. Starting with the 2026 tax year, the maximum deductible contribution per beneficiary rises from $4,000 to $5,000 for single filers, and from $8,000 to $10,000 per beneficiary for joint filers. The law would take effect as soon as the Governor signs it or it becomes law without his signature.

What the bill does

Removes the fixed $235,000 cap on total 529 account balances per beneficiary and lets the plan's board set its own maximum based on education cost projections.
Raises the state income tax deduction for 529 contributions from $4,000 to $5,000 per beneficiary for single or separate filers.
Raises the deduction cap for joint filers from $8,000 to $10,000 per beneficiary.
Applies the higher deduction amounts starting with tax years beginning on or after January 1, 2026.
Gives the bill a short title, the 'College Success 529 Expansion Act.'

Who it affects

Georgia families and individuals who save for college through the Georgia Higher Education Savings Plan (529 accounts), the plan's governing board, and Georgia taxpayers who claim the state income tax deduction for contributions to these accounts.

Why it matters

Families could keep contributing to a beneficiary's 529 account past the current $235,000 limit if the board raises the cap, and both single and joint filers could deduct more from their state taxes each year for contributions, potentially lowering their state tax bills starting in 2026.

Key provisions

Section 2 revises O.C.G.A. § 20-3-634(b)(1) to replace the fixed $235,000 account balance cap with a board-determined 'reasonable maximum amount' based on current and anticipated education expenses.
Section 3 revises O.C.G.A. § 48-7-27(a)(11.1) to raise the per-beneficiary deduction from $4,000 to $5,000 and set the effective tax year starting January 1, 2026.
Section 3(C) raises the joint-filer deduction cap per beneficiary from $8,000 to $10,000.
Section 4 sets the effective date as the date the Governor signs the bill or it otherwise becomes law without his signature.

Status timeline

2025-02-27Senate Read and Referred (Senate)
2025-02-26Senate Hopper (Senate)

Topics

529 college savings
state tax deductions
higher education funding
Georgia income tax

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