Hello brain trust, insight is much appreciated.
My question is as the title says: For WI ABLE accounts can you contribute > claim the state tax deduction > and withdraw all or part of those funds in same year?
Further:
Wisconsin has no state-sponsored ABLE program, but they provide a state tax deduction for contributions: up to $15,000 so a savings of 6.27% (~$940) at the states middle tax rate.
To my understanding, to claim the state deduction you use Schedule SB Line 21 (Source) which flows into the state income tax Form 1, Line 4.
It appears to me, in Form 1, as long as distributions are for qualified expenses then your Federal AGI wouldn't be affected, and an individual with an Able account could make a contribution - take the state tax deduction - and also a qualified withdrawal of all or part of those funds in the same year.
Has anyone else done this or have additional insight in WI or your own state if a tax deduction applies?
WI Able Acct: Can you contribute, claim deduction, & distribute in same year?
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