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Beth A. Botti, CFP®, ChFC, CLU, CDFA™
Financial Consultant
California Insurance License #0G24537
612 Wheelers Farms Road, Milford, CT 06460
Phone: 203-877-6556 Ext. 169
Fax: 203-301-0736
Email: beth.botti@equitable.com
May/June 2024
Leftover 529 Plan Funds
Congratulations, your youngest child has graduated college, and there’s money left in their 529 college savings plan.* Now, the question is what to do with that money. If you want to liquidate the account, you have several tax-advantaged choices.
You can make tax-free 529 plan distributions to pay student loan principal and interest of up to $10,000 a year for the recent grad and each of their siblings, including stepbrothers and stepsisters.
Starting in 2024, 529 education accounts can be rolled over tax-free to a Roth IRA for the 529 plan beneficiary. There’s a $35,000 cap. Rollover amounts can’t exceed the annual contribution limit for Roth IRAs ($7,000 in 2024). As the owner of the Roth IRA, your graduate must have earned income at least equal to the rollover amount. The 529 plan must have been open for over 15 years before you can do a 529-to-Roth IRA transfer.
Now through 2025, money may be rolled over from a 529 plan into an Achieving a Better Life Experience (ABLE) account or a qualified family member with disabilities to help save and pay for disability-related expenses. The current annual contribution limit is $18,000.
Discuss 529 plans with your financial and tax professionals.
*Certain requirements may apply. Before investing, read the program offering statement and consider the investment objectives, risks, charges, and expenses. These plans are not guaranteed by any state or federal agency, credit union or bank and are subject to investment risk and may lose principal.
GE-6175675.2(1/24)(Exp.1/26)
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Duly registered and licensed financial professionals offer securities through Equitable Advisors, LLC (NY, NY 212-314-4600), member FINRA,SIPC (Equitable Financial Advisors in MI & TN), offer investment advisory products and services through Equitable Advisors, LLC, an SEC-registered investment advisor, and offer annuity and insurance products through Equitable Network, LLC (Equitable Network Insurance Agency of Utah, LLC in UT; Equitable Network of Puerto Rico, Inc.). Equal Opportunity Employer - M/F/D/V. Equitable Advisors and its associates and affiliates do not provide tax, accounting, or legal advice or services. Representatives may transact business, which includes offering products and services and/or responding to inquiries, only in state(s) in which they are properly registered and/or licensed. Your connection to this website does not necessarily indicate that the sender is able to transact business in your state. The information in this website is not investment or securities advice and does not constitute an offer. For more information about Equitable Advisors, LLC you may visit https://equitable.com/crs to review the firm's Relationship Summary for Retail Investors and General Conflicts of Interest Disclosure.
GE-6572038.1 (4/24)(Exp. 4/26)
CFP®, and CERTIFIED FINANCIAL PLANNER™ are certification marks owned by the Certified Financial Planner Board of Standards, Inc. These marks are awarded to individuals who successfully complete the CFP Board's initial and ongoing certification requirements.
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