The annual Virginia 529 tax deduction benefit is available for parents and grandparents who are taxpayers in Maine and who make contributions to the section 529 plan on behalf of their child or grandchild. Maine taxpayers receive a $250 deduction for each 529 college plan recipient for which they make contributions. So theoretically, you can have five beneficiaries and receive a $1,250 deduction. The federal amount is $12,000 (or $24,000 for married joint filers) per year, per child. Simply stated, you can contribute up to $12,000 without incurring a federal gift tax. Any amount exceeding the 529 gift tax exclusion limit is considered a taxable gift and must be reported on your federal gift tax return.