For costs associated with grades K-12, funds in a 529 account can now be used for educational expenses other than just tuition. Such funds can also be used to pay for curriculum materials, online educational materials, tutoring costs, standardized exam and placement fees, and educational therapy for students with disabilities. As always, 529 funds can be used for college expenses. In addition, 529 funds can now also be used for costs related to obtaining certain credentials (for example, professional licenses or trade certifications).

In addition, the amount that can be withdrawn tax-free from a 529 account for K-12 expenses has increased from $10,000 a year to $20,000 a year. This change applies to tax years beginning after December 31, 2025.

These changes, among others, make 529 accounts a more flexible savings tool for your loved ones. We recommend you consult with your financial planner regarding your savings and investment options and with your estate planning attorney to discuss how 529 accounts may fit best into your gift and estate planning.

If you have any questions about your estate planning, please contact an attorney in our estate planning practice group, including Ryan Montgomery, Kaitlyn K. Perez, Allison Int-Hout, Matthew Hart, or Kara Kalenius Novak.