Ep. 86 | What's the 411 with 529 Plans?

Download MP3
In Episode 86 of the Teaching Tax Flow podcast, hosts John and Chris delve into an essential topic for many families: 529 plans. The episode, cleverly titled "What's the 411 with 529 Plans," explores the ins and outs of these educational savings accounts, aiming to provide listeners with deep insights on how to leverage these plans to minimize tax burdens while saving for education. Sponsored by RepsTracker, the episode also shares an engaging dynamic between the hosts, spiced with personal anecdotes and up-to-date tax legislative changes.

529 plans are powerful tools for tax-free growth and withdrawals for educational expenses, but their benefits extend beyond the traditional college savings scenarios. Chris and John explore how these plans can be used for K-12 tuition, apprenticeships, and even rolled over into Roth IRAs under certain conditions. With the Secure 2.0 Act bringing new changes in 2024, there's never been a better time to get to grips with these versatile instruments. This episode provides actionable strategies, historical context, and advice for parents, grandparents, and even neighbors wanting to contribute to a child's educational future.

Key Takeaways:
  • 529 Plans Overview: These are state-sponsored accounts for saving toward educational expenses, offering tax-free growth and withdrawals for qualified expenses.
  • Expanded Uses: Beyond college and university tuition, 529 plans can now be used for K-12 education, vocational schools, trade schools, community colleges, apprenticeships, and certain certified programs.
  • Estate Planning Benefits: 529 plans can be an effective tool for estate planning, allowing significant contributions that grow tax-free and can potentially reduce estate tax liabilities.
  • New Secure 2.0 Act Rule: Starting in 2024, leftover 529 funds can be rolled into a Roth IRA under certain conditions, giving more flexibility in managing unused educational funds.
  • Financial Advice: Always consult with a tax professional and financial advisor to maximize the benefits of 529 plans and tailor them to your specific needs.

Notable Quotes:
  1. Chris Picciurro: "Knowledge does us no good if we don't share it with the world."
  2. John Tripolsky: "Today's educational climate is broader, and how can 529 plans benefit you come tax time?"
  3. Chris Picciurro: "You can now use a distribution of up to $10,000 per year per beneficiary for K-12 schools."
  4. Chris Picciurro: "From a federal tax perspective, there's no deduction for contributions, but many states offer benefits."
  5. Chris Picciurro: "In 2024, if you have money left in a 529 plan, you can roll it into a Roth IRA."


Episode Sponsor:


Creators and Guests

Ep. 86 | What's the 411 with 529 Plans?
Broadcast by