As summer nears, many parents are already thinking about covering education costs for the next school year. One option is the Section 529 savings plan, which offers federal (and sometimes state) tax benefits. Originally these plans could only be used for postsecondary education. The Tax Cuts and Jobs Act expanded the plans to cover K-12 tuition for public, private, or religious schools, up to $10,000. The SECURE Act added flexibility, allowing the use of up to $10,000 to repay student loans for the 529 plan beneficiary, and another $10,000 to pay off student loans for beneficiary’s siblings. Certain apprenticeship programs are also eligible for 529 payment. Contact us with questions.
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