While most families associate 529 plans with college or university, few know that they can now be used for K-12 private education. The new tax law passed by Congress last year included a provision in which parents are now allowed to pay for private school education from kindergarten to twelfth grade. Under the new law, families can withdraw $10,000 per student per year to pay for tuition expenses at private elementary schools, high schools and parochial schools. Keep in mind though, the law only covers private institutions and only applies to tuition costs – it excludes things like books, laptops, or other expenses often covered by 529 plans.
Parents often have many questions about 529 Plans – what they are, how to use them, what their benefits are. We’ve covered all those topics in other posts here, but have not gone over some of the myths of the plans themselves. Here we outline five of the most popular myths of a 529 plan.
Sending children to college can be one of the most rewarding experiences of a parent’s life. The excitement of watching your son or daughter start a new journey, coupled with the promise of all the wonderful things they’re going to learn can bring immense joy. Knowing that the next few years will be a transformative experience, parents try to prepare for the road ahead as best they can. But let’s face it, the prospect can be a bit overwhelming. The cost of college has been rising steadily for decades. This is why parents need to know about the 529 plan!