Expansion of 529 plans to allow K-12 expenses
The New Tax Law gives 529 Plans even more flexibility...Under the new law, the definition of a 529 plan "qualified education expense" has been expanded to include K-12 expenses.
Starting in 2018, annual withdrawals of up to $10,000 per student can be made from a 529 college savings plan account for tuition expenses in connection with enrollment at an elementary or secondary public, private, or religious school (excluding home schooling). Such withdrawals are now tax-free at the federal level.
Expansion of 529 plans to allow transfers to ABLE accounts
The new tax legislation also allows 529 account owners to roll over (transfer) funds from a 529 plan to an ABLE plan without federal tax consequences. This ability to transfer funds will expire at the end of 2025 unless a future Congress acts to extend the law. An ABLE plan is a tax-advantaged account that can be used to save for disability-related expenses for individuals who become blind or disabled before age 26.