Lesson · Facts First
The 529 Savings Plan
State tax deduction in, tax-free growth, tax-free out for education - plus a Roth escape hatch you probably have not heard of.
The facts
- 01Qualified withdrawals cover tuition, fees, room and board, books - and up to $10,000 per year per beneficiary for K-12 tuition under federal law (IRC 529(c)(7)).
- 02Student loans: up to $10,000 lifetime per beneficiary can be repaid from a 529 penalty-free (SECURE Act 2019).
- 03SECURE 2.0 (2022): after 15 years, up to $35,000 of leftover 529 funds can roll to the beneficiary’s Roth IRA - subject to the beneficiary’s own annual IRA limits.
- 04The account owner controls the money, not the child - and you can change the beneficiary to another family member without tax.
Sources
- IRC Section 529(c)(7)
- SECURE Act 2019 (student loan provision)
- SECURE 2.0 Act 2022 (Roth rollover, Section 126)
Educational content only — not tax, legal, investment, or VA-benefits advice. Figures verified against the cited sources for 2026; confirm your own situation with a qualified professional before acting.
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