I know just enough to be dangerous.
For years, I read about the 5 year prepayment for 529's - putting 5 years of gift money into each kids account so it can start appreciating in the account sooner, etc.
I did that and my wife did that in 2018.
Mentioned that we did that on the questionaire our accountant sent us for the 2018 tax year.
Our accountant called and talked of 'your kids are graduating college / grad school, why are you putting money in the 529s now?'. I thought this was the poor mans trust (Ok, just a cheap man's who doesn't want to pay a lawyer to set up / manage a trust / way to move money to the kids. Yes, our kids aren't going to be using / needing the money for their education. We are fortunate to have been able to pay with aftertax money / the kids didn't take loans, etc.
I envisioned that this money would be for THEIR kids (none of our kids are even engaged at this point). I read how you can change beneficiaries, etc....
The accountant said that the IRS doesn't allow / doesn't like (I forget the exact words he used) you overfunding 529s.... maybe if the grandkids existed, you are planning for them. but to not even have grandkids in the picture yet he said wasn't good
Maybe it's such a unique situation that no one writes about it, but I can't find anything about overfunding 529 being against IRS rules.
Anyone know anything about that? As I said above - I know just enough to be dangerous. I could be shooting myself in the foot with this.
THANKS!
