Source: The College Investor One of the big perks of using a 529 plan to save for college is that many states offer a tax deduction for 529 plan contributions. Other states offer tax credits, and some even will allow contributions to any state’s plan (this is called tax parity) But, like anything, there are rules that apply. Some states require you to contribute to their state’s plan, while other states allow you to take the tax deduction for contributions to any state’s plan. Finally, there are (sadly) states that don’t offer any incentives for contributions. Also, the rules for withdraw can …