Wed May 08 2024, by Tyler Gardner

529 PlansRoth IRAEducational SavingsTax RulesFinancial Planning

The New Rule: Transferring 529 College Savings to a Roth IRA

Tyler?

Yep.

Says here you took out $35,000 from your daughter's 529 college savings plan for non-qualified educational expenses?

Yep.

Okay, well you owe us 10% of that.

Oh, no, I just put it into her Roth IRA.

Uh, you can't do that.

Uh, starting in 2024, yes you can. As long as the 529 has been open for at least 15 years, I can transfer up to $35,000 into the Roth IRA.

Well, she can't touch that $35,000 until she's 59 and a half.

This is a Roth IRA. She can access the contributions whenever she wants for whatever she wants.

So we get nothing.

Source