Can you transfer a 529 plan?

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Yesterdaysnews
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Can you transfer a 529 plan?

Post by Yesterdaysnews »

I have 529 plans for both my kids at Vanguard. I want to transfer them to Schwab to consolidate holdings. Is that possible? Would I have to pay taxes? Thanks
Makefile
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Re: Can you transfer a 529 plan?

Post by Makefile »

529s are operated by states, not fund companies/brokerages directly, so you'd have to find a different state's plan that operates through Schwab (and at low costs).

You can transfer without paying taxes. The exception would be if you received a state income tax benefit for using your own state's "native" 529 and if your state requires that some or all of it be paid back.
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Beachey
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Re: Can you transfer a 529 plan?

Post by Beachey »

Yesterdaysnews wrote: Thu Jan 26, 2023 4:52 pm I have 529 plans for both my kids at Vanguard. I want to transfer them to Schwab to consolidate holdings. Is that possible? Would I have to pay taxes? Thanks
I believe you can transfer, where it depends is who is the sponsor of the 529 plan (i.e what state and whether you took a State tax benefit). In my case, if I transferred the money out of my state plan, my state would make me pay back the tax deductions I took.
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Yesterdaysnews
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Re: Can you transfer a 529 plan?

Post by Yesterdaysnews »

No state tax where I live TX.

I believe i was using an Utah plan at vanguard ?? Not sure it just says Growth
SchruteB&B
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Re: Can you transfer a 529 plan?

Post by SchruteB&B »

Yes, it looks like Schwab has a plan through Kansas. Here is the link to rollover a 529

https://www.schwab.com/resource/schwab- ... lover-form
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Yesterdaysnews
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Re: Can you transfer a 529 plan?

Post by Yesterdaysnews »

Does Vanguard require the medallion signature guarantee to transfer out a 529 account? Anyone know / dealt with this ?
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typical.investor
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Re: Can you transfer a 529 plan?

Post by typical.investor »

Yesterdaysnews wrote: Thu Jan 26, 2023 7:49 pm Does Vanguard require the medallion signature guarantee to transfer out a 529 account? Anyone know / dealt with this ?
If you can’t get Vanguard to answer, call the Schwab 529 number. They have detailed info on other plans requirements.
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Yesterdaysnews
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Re: Can you transfer a 529 plan?

Post by Yesterdaysnews »

typical.investor wrote: Fri Jan 27, 2023 12:47 am
Yesterdaysnews wrote: Thu Jan 26, 2023 7:49 pm Does Vanguard require the medallion signature guarantee to transfer out a 529 account? Anyone know / dealt with this ?
If you can’t get Vanguard to answer, call the Schwab 529 number. They have detailed info on other plans requirements.

Thank you for this reply. Called CS and they said no need for that for Vanguard, both companies basically use the same intermediary for these transfers.
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typical.investor
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Re: Can you transfer a 529 plan?

Post by typical.investor »

Yesterdaysnews wrote: Fri Jan 27, 2023 1:19 pm
typical.investor wrote: Fri Jan 27, 2023 12:47 am
Yesterdaysnews wrote: Thu Jan 26, 2023 7:49 pm Does Vanguard require the medallion signature guarantee to transfer out a 529 account? Anyone know / dealt with this ?
If you can’t get Vanguard to answer, call the Schwab 529 number. They have detailed info on other plans requirements.

Thank you for this reply. Called CS and they said no need for that for Vanguard, both companies basically use the same intermediary for these transfers.
Yeah, they are good right!

I am happy to see they have a cheap index option and will transfer my account there too after waiting a year after opening a bank account needed to get the medallion required for mine.
DarkHelmetII
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Re: Can you transfer a 529 plan?

Post by DarkHelmetII »

My state has a two year look back period - based on account inception - to recapture state level deduction. Point is: for anyone living in a state with income tax, understand this before switching states.
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