529 Plans
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529 Plans
Treading carefully here in order to avoid discussing proposed legislation.
We live in Washington state (no state income tax ) and have Vanguard 529s for our two children. I know that multiple 529s are allowed but does anyone know if I could open a second 529 with Vanguard for each child? I'd like to keep private high school savings and college savings separate. Or is there another plan that bogleheads would recommend for a second 529?
We live in Washington state (no state income tax ) and have Vanguard 529s for our two children. I know that multiple 529s are allowed but does anyone know if I could open a second 529 with Vanguard for each child? I'd like to keep private high school savings and college savings separate. Or is there another plan that bogleheads would recommend for a second 529?
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Re: 529 Plans
Deleted
Last edited by letsgobobby on Fri Aug 02, 2019 11:56 pm, edited 1 time in total.
Re: 529 Plans
I see no reason you couldn’t open more than 1 529 plan with Vanguard. You could check out the Clark Howard deans list with high honors, then compare them to the Nevada plan. Surprised Nevada not getting high honors, but looks like it only has 4.5 graduating caps vs 5 for California for example at savingforcollege.com
http://clark.com/education/clarks-529-plan-guide/
http://www.savingforcollege.com/compare_529_plans/
http://clark.com/education/clarks-529-plan-guide/
http://www.savingforcollege.com/compare_529_plans/
Last edited by mhalley on Sat Dec 16, 2017 1:44 pm, edited 1 time in total.
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Re: 529 Plans
Honestly, I'd never considered it. It was frozen a few years ago and since then they've actually cut in-state tuition. We started our 529s before we lived here and their performance has been good.letsgobobby wrote: ↑Sat Dec 16, 2017 1:30 pmWhat do you think about the WA GET prepaid plan?Isabelle77 wrote: ↑Sat Dec 16, 2017 11:52 am Treading carefully here in order to avoid discussing proposed legislation.
We live in Washington state (no state income tax ) and have Vanguard 529s for our two children. I know that multiple 529s are allowed but does anyone know if I could open a second 529 with Vanguard for each child? I'd like to keep private high school savings and college savings separate. Or is there another plan that bogleheads would recommend for a second 529?
We also use UT, NY, and NV.
I'm more interested in starting separate 529s for high school tuition and wondering if I can do that with Vanguard even though we already have other 529s with them. This may be a discussion for the end of next week though, I don't want to break forum rules.
Re: 529 Plans
Private high school tuition is not an eligible educational expense for 529 plan distributions. 529 plans are for post-secondary education.Isabelle77 wrote: ↑Sat Dec 16, 2017 11:52 amI know that multiple 529s are allowed but does anyone know if I could open a second 529 with Vanguard for each child? I'd like to keep private high school savings and college savings separate.
I highly recommend reading IRS Pub 970. If you’re looking for a tax-sheltered savings plan for K-12 tuition, you will need to look at Coverdell ESAs, which Vanguard does not offer.
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Re: 529 Plans
Well it isn’t eligible TODAY but in 2 weeks...The529guy wrote: ↑Sat Dec 16, 2017 2:46 pmPrivate high school tuition is not an eligible educational expense for 529 plan distributions. 529 plans are for post-secondary education.Isabelle77 wrote: ↑Sat Dec 16, 2017 11:52 amI know that multiple 529s are allowed but does anyone know if I could open a second 529 with Vanguard for each child? I'd like to keep private high school savings and college savings separate.
I highly recommend reading IRS Pub 970. If you’re looking for a tax-sheltered savings plan for K-12 tuition, you will need to look at Coverdell ESAs, which Vanguard does not offer.
We’re not eligible for ESAs unfortunately.
Re: 529 Plans
If your income is too high for an ESA, you can contribute to a UTMA then transfer into ESA. Or have someone else contribute.
Unfortunately the contribution limits are relatively low, and their future is uncertain.
Unfortunately the contribution limits are relatively low, and their future is uncertain.
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Re: 529 Plans
But why if 529s are going to be allowed for k-12?
Re: 529 Plans
Sorry, I was not aware a change was being considered. Now I understand your original caveat.Isabelle77 wrote: ↑Sat Dec 16, 2017 3:10 pmWell it isn’t eligible TODAY but in 2 weeks...The529guy wrote: ↑Sat Dec 16, 2017 2:46 pmPrivate high school tuition is not an eligible educational expense for 529 plan distributions. 529 plans are for post-secondary education.Isabelle77 wrote: ↑Sat Dec 16, 2017 11:52 amI know that multiple 529s are allowed but does anyone know if I could open a second 529 with Vanguard for each child? I'd like to keep private high school savings and college savings separate.
I highly recommend reading IRS Pub 970. If you’re looking for a tax-sheltered savings plan for K-12 tuition, you will need to look at Coverdell ESAs, which Vanguard does not offer.
We’re not eligible for ESAs unfortunately.
I should change my username.
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Re: 529 Plans
Deleted
Last edited by letsgobobby on Fri Aug 02, 2019 11:56 pm, edited 1 time in total.
Re: 529 Plans
I have essentially the same question. I have 3 children that each have 529 plans at Vanguard (moderately aggressive-age adjusted plans) that I intend to use for college/graduate school expenses.
With the new tax law, I'm interested in opening a second 529 plan to pay for private school (K-12) in Alabama where we live. It's my understanding that a child can have multiple 529 plans. I probably should have originally put the money in the Alabama 529 plan, although I didn't live here when these were started.
I'm curious if I am able to fund an Alabama 529 plan for their tuition ( which costs roughly $15,000/year/child). I think the maximum that can be withdrawn is $10,000/year. So, if I funded one of these with $10,000 in something like the Prime money market account, could I take the state tax deduction (5%, $500) and use that $10,000 a few months later to pay tuition without a penalty? It doesn't seem right??
With the new tax law, I'm interested in opening a second 529 plan to pay for private school (K-12) in Alabama where we live. It's my understanding that a child can have multiple 529 plans. I probably should have originally put the money in the Alabama 529 plan, although I didn't live here when these were started.
I'm curious if I am able to fund an Alabama 529 plan for their tuition ( which costs roughly $15,000/year/child). I think the maximum that can be withdrawn is $10,000/year. So, if I funded one of these with $10,000 in something like the Prime money market account, could I take the state tax deduction (5%, $500) and use that $10,000 a few months later to pay tuition without a penalty? It doesn't seem right??
Re: 529 Plans
That's my understanding of the new tax law. I think it doesn't seem right because this was never the intent of the original law (my interpretation, I suppose). The federal law has now changed to the detriment of the state tax system. it will be interesting to see if states choose to "fix" this problem with new laws on deductibility.cwp wrote: ↑Sat Dec 30, 2017 1:11 pm I have essentially the same question. I have 3 children that each have 529 plans at Vanguard (moderately aggressive-age adjusted plans) that I intend to use for college/graduate school expenses.
With the new tax law, I'm interested in opening a second 529 plan to pay for private school (K-12) in Alabama where we live. It's my understanding that a child can have multiple 529 plans. I probably should have originally put the money in the Alabama 529 plan, although I didn't live here when these were started.
I'm curious if I am able to fund an Alabama 529 plan for their tuition ( which costs roughly $15,000/year/child). I think the maximum that can be withdrawn is $10,000/year. So, if I funded one of these with $10,000 in something like the Prime money market account, could I take the state tax deduction (5%, $500) and use that $10,000 a few months later to pay tuition without a penalty? It doesn't seem right??