Breaking Down the New Tax Reform Proposal – 529 Plans

We’ve all been inundated lately with articles about the proposed new tax law. The information seems to be endless. So, we thought it would be helpful to periodically point out proposed items that might affect our typical client. Below are a few of the proposed changes to 529 plans that we believe may affect many of you.
  1. Some of our clients have wanted to pre-fund a Section 529 plan for unborn children or grandchildren. In this situation, we had them set up an account with a parent named as the beneficiary and then change the beneficiary after the baby was born. The new law would allow 529 plans to be established for an unborn (In Utero) child.
  2. The proposed new law would also allow up to $10,000 of private elementary or high school costs to be considered as qualified expenses for 529 plans. Currently, only post-secondary costs are considered qualified.
Should you have any questions, please feel free to call or email your Louis T. Roth & Co. advisor.