If I open a 529 for my daughter, can I make deposits in it, then immediately use it to pay college expenses, to help with taxes? Or does it have to stay in the account a certain period of time before it is withdrawable?
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I don't believe there is any minimum time the money needs to be in the account.Steve
* Despite the high cost of living, it remains very popular.
* Why should I pay for my daughter's education when she already knows everything?
* There are no shortcuts to anywhere worth going. -
You can use it right away. I put my kids graduation party money in it then take it out a few months later to pay tuition, that way I can get a tax break on my state taxes. Check your state not all states give deductions.Comment
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I've done this. Illinois gives a credit for deposits to a 529, so it's an easy way to make 4.95% on my money. If you're not getting a state credit, I don't see a benefit in doing this for federal taxes. It could actually hurt you in terms of getting a federal tax credit.Comment
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