In 2024, we will see a host of new changes that could impact your 529 plans. See below for the most important changes and links for further information. And as always, please feel free to call us with any questions!
SECURE ACT 2.0 Updates:
This new change will allow you to roll over 529 plan money into a Roth IRA for the beneficiary, up to $35,000 over the course of the beneficiary’s lifetime.
Here is an article on the topic with more details: https://smartasset.com/financial-advisor/secure-act-529 or our blog post on SECURE updates from 2023 https://www.shepherdfinancialpartners.com/secure-2-0-savings-update/
Changes To FAFSA:
There are a handful of changes for the FAFSA form, including:
- A new application start date (This month!)
- A shorter form
- Changes to the Expected Family Contribution (the calculation of the amount of aid one family can receive
- Eligibility changes for families with 2+ children enrolled in college
- The filer of the FAFSA (now whichever parent provides the greater amount)
- Requirement to report family farms and small businesses
Here is an article on the topic with more details: https://www.nerdwallet.com/article/loans/student-loans/new-fafsa-what-parents-of-college-students-need-to-knowor read our blog post https://www.shepherdfinancialpartners.com/college-planning-free-application-for-federal-student-aid-fafsa/
Annual Gifting Limits will be Increasing:
Starting in 2024, the gift tax limit will increase to $18,000 for an individual (from $17k) and $36,000 for married couples (from $34K). The 5-year accelerated gift limits will also increase to $90,000 and $180,000, respectively.
Here is an article on the topic with more details: https://www.nerdwallet.com/article/taxes/gift-tax-rate#Gift%20tax%20limit%202024 or read our blog post on gifting https://www.shepherdfinancialpartners.com/year-end-strategies-for-gifting/
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