The basic 529 advantages include starting early tax-advantaged savings accounts for future college and other post-secondary students. As discussed in the opening chapters, a number of significant improvements have been made over its 30 year history.
Please note that a few options discussed in this chapter have limited details from the IRS, making them “gray” areas that could later become clearer through case law. A 529 account should not be used to avoid either federal or state taxes. Be sure to keep records and abide by the current letter of the state program. Consider consulting with your financial, tax, or legal advisors in these matters.
The rules in this chapter
- 1Maximizing FundingIf you are fortunate enough to have wealth without yet nearing the estate maximum exemption limits, consider 5 year 529 superfunding up to $190K per beneficiary (file form 709).
- 2Maximizing K-12 OptionsBenefits now begin as a child enters kindergarten.
- 3Maximizing Post Secondary optionsReceive a state deduction or credit if your child lives at home while enrolled over ½ time.
- 4Maximizing After GraduationKeeping the accounts open after graduation has become much more important.
- 5Maximizing Estate PlanningConsider leaving a legacy emphasizing education.