S745 - Restore Tax Deduction for 529 Plan

• Allows individual taxpayers to deduct up to $2,500 per year in contributions to the Parental Savings Trust Fund (529 plan) from North Carolina taxable income.

• Increases the maximum deduction to $5,000 per year for married couples filing joint returns.

• Requires taxpayers to add back to adjusted gross income any previously deducted amounts that were withdrawn from the account and not used for qualified higher education expenses of the designated beneficiary.

• Provides an exception to the add-back requirement if funds were withdrawn without penalty under federal tax code Section 529 due to the designated beneficiary's death or permanent disability.

• Effective for taxable years beginning on or after January 1, 2016.