Other than state tax deduction where applicable, what's the advantage of a 529 plan over just transferring appreciated shares (both invested in a similar index fund) to your child in college? If you gift, and that 18 year old is at an income level with 0% long term capital gains, the child can sell them and pay for education that way (up to $30K per couple/year?).
What’s missing?
529 vs gifting shares
529 vs gifting shares
1) Invest you must 2) Time is your friend 3) Impulse is your enemy 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course. (Plagiarized, but worth stealing)
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ModifiedDuration
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Re: 529 vs gifting shares
Kiddie Tax
Re: 529 vs gifting shares
“ The kiddie tax is a tax imposed on individuals under 17 years old whose investment and unearned income is higher than an annually determined threshold.”
Wait till 18
1) Invest you must 2) Time is your friend 3) Impulse is your enemy 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course. (Plagiarized, but worth stealing)
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anon_investor
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Re: 529 vs gifting shares
I think you have to wait until 24:
https://www.bogleheads.org/wiki/Kiddie_tax
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ModifiedDuration
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Re: 529 vs gifting shares
Yes, the Kiddie Tax applies until age 24 for full-time students.