“I set up a 529 plan for my granddaughter. She is graduating in May and there will be about $19,000 left in the account. Does it belong to her? Is it taxable? Can she do whatever she wants with it?”
You are the owner of the 529 plan. Your granddaughter was the beneficiary. She has no rights to the $19,000 remaining in the plan – unless you decide to give them to her. Should you decide to close the account the gains will be taxable – to you. You will also likely face a 10% penalty since the funds would not be used for educational expenses. You do not have to close the account. There is no age limit at which the account ‘matures’. You have many other options. Please consult with a financial advisor who can outline your options and assist you in selecting the one that best fits you and your goals.
Gene answers your neighbors financial questions on More than Money.
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