Every state except Wyoming offers a 529 college savings plan.
Refer to a complete list of 529 college savings plans, listed by state.
You can invest in any 529 plan from any state. But before you invest, see if the plan offers any additional in-state benefits for the state where you or your beneficiary resides. Your state might offer a plan that is beneficial to you or your beneficiary, or another state’s plan might include your state as a recipient of favorable treatment.
You can use plan assets at any eligible school (one accredited for financial aid) around the country and abroad. That includes K-12, two- and four-year colleges, graduate schools (including law and medical) and vocational and technical schools.
There are no income limitations for a 529 plan. In fact, through “accelerated gifting,” an account owner can apply up to five years of annual gift tax exclusion from a single lump sum contribution in a single year, without incurring a gift tax.1 However, contribution funding limits vary and are established by each plan.
No, a 529 account owner always controls the account. If your child doesn’t go to college, you can:
- Name another eligible member of your family as a beneficiary (subject to plan rules)
- Use the funds for your own qualified education expenses
- Take a non-qualified withdrawal
A non-qualified withdrawal subjects earnings to a 10% federal penalty and applicable federal, state and local income tax. Your assets in a 529 plan account can grow in perpetuity; there are generally no time or age limits on your use or distribution of plan assets.2
Anyone of any age can use a 529 plan to save for education. In fact, you can be your own account beneficiary. If your chosen school is eligible, you can use 529 assets to pay for education expenses — even if you’re not attending full-time.
529 savings can be used to pay for many college expenses, including:
- Tuition
- Fees
- Applicable room and board costs
- Any supplies required by the school (e.g. computers)
- Student loans repayments*
- Apprenticeship programs**
A 529 plan has a relatively small impact on federal financial aid eligibility because 529 plan assets are considered assets of the account owner, rather than the beneficiary. When the parent is the account owner, 529 plan assets are factored into the expected family contribution rate, the same as any other parental asset. Learn more in BlackRock's Understanding College Aid brochure or consult with a financial professional.
If a beneficiary receives a scholarship, 529 plan assets up to the amount of the scholarship can be returned to the account owner. While this is regarded as a non-qualified withdrawal, the 10% federal penalty will be waived in this instance. But earnings will be subject to any federal, state and local income tax. Alternatively, you can change the beneficiary to another eligible member of your family.
With a few exceptions, there are no limitations on who can be an account owner or beneficiary for a 529 plan.3 Parents, grandparents, aunts, uncles, friends — almost anyone can be an account owner. Trusts, corporations and custodial accounts with valid Tax ID numbers may also be account owners.
For most 529 plans, anyone can contribute. There can only be one account owner per account, but others – family members and even friends – can contribute.
