Washington gave parents more room to spend their own education savings. Louisiana hasn’t caught up.
A new report from the American Legislative Exchange Council finds that state laws in 16 states have not fully aligned with expanded federal rules, potentially leaving families exposed to state tax liabilities and penalties. Louisiana is on the list. Arkansas, Kentucky and Louisiana allow funds to cover K-12 tuition, but only up to $10,000 annually.
What changed federally
The 2025 federal tax law doubled the annual limit for qualified K-12 expenses from $10,000 to $20,000. It also broadened what counts. K-12 qualified expenses now cover curriculum materials, books, online educational materials, tutoring, standardized test fees, dual enrollment fees, and therapies for students with special needs.
That matters for homeschool families, students taking dual enrollment courses, and parents paying for tutoring or special needs therapy. Under federal law, those families can now use their 529 savings tax-free.
Where Louisiana stands
Louisiana built its K-12 option in 2018. The START K12 Program was created through Act 687 of the 2018 Regular Session to implement the Tax Cuts and Jobs Act of 2017. The rules have not moved since. START K12 withdrawals are limited to a maximum of $10,000 per year and may be used for K12 tuition expenses only. State law also defines such expenses as tuition at a public or approved nonpublic elementary or secondary school in Louisiana.
There is a second gap. Louisiana taxpayers can deduct up to $2,400 ($4,800 if married filing jointly) for contributions to the START Saving Program, but not for contributions to START K12. savingforcollege
The result: a Louisiana parent who follows federal rules could still run into state tax trouble, and the state offers no deduction to encourage K-12 saving in the first place.
The fix is simple
Louisiana has spent the last few years trying to build an ambitious school choice program. A 529 law frozen at 2018 tuition-only rules cuts against that work. Conforming START K12 to the federal $20,000 cap and the expanded expense list would cost families nothing and give them the flexibility Congress already approved.
The Legislature should take it up in 2027.