Additional qualified uses
New laws have been put in place that expand the potential qualified uses of 529 plans. Distributions can be used to pay for up to $10,000 a year per beneficiary for elementary and secondary school (public, private and religious) tuition expenses, which are not subject to federal income tax. Plans can also pay for qualified costs associated with apprenticeship programs. Eligible programs can be offered through trade schools and community colleges and must be registered with the U.S. Department of Labor. In addition, 529 plans can help repay certain student loans, up to a $10,000 limit.
Enhanced flexibility for unused 529 assets
A common question that arises when parents think about setting up a 529 account is, "What if my child doesn't end up going to college?" A recently passed piece of legislation known as the Secure 2.0 Act may help provide some enhanced flexibility to those who encounter this situation. Beginning in 2024, 529 account owners can roll over unused 529 assets to a Roth IRA for the beneficiary, subject to certain criteria and limitations.
For important details on the changes, criteria, limitations and what the new legislation could mean for you, please see our Secure Act 2.0 page.
How to get started
Our Edward Jones financial advisors continue to work with clients on their evolving financial priorities, including saving for education.In 2020, the firm was ranked number 1 in the U.S. in 529 plan funding.
Trying to understand and plan for future education costs can seem overwhelming and confusing. Your Edward Jones financial advisor can work with you to review your overall financial strategy and determine how to reach all of your family’s saving goals, including education.
Contact your Edward Jones financial advisor or find one today!