- When you can rollover funds. Internal Revenue Service (IRS) rules allow funds to be rolled over from one 529 plan to another 529 plan once every 12 months for the same beneficiary.
- Member of the family. Alternatively, you can rollover funds between 529 plans any time for a different beneficiary as long as that beneficiary is a member of the previous beneficiary’s family.
- Time limit to transfer funds. Funds must be transferred to a different 529 plan within 60 calendar days from withdrawal to be considered a qualified rollover, according to IRS rules.
- Applies to Coverdell. These considerations also apply to a rollover from or to a Coverdell Education Savings Account (ESA).
- Tax consequences may ensue. See below.
Types of Rollovers
- Incoming – To my529 from another 529 plan
- Outgoing – From my529 to another 529 plan, or to an Achieving a Better Life Experience (ABLE) Plan.
How to roll over funds to my529 from another 529 plan
- Open a my529 account.
- If the other 529 plan allows it, you can request my529 to initiate the rollover by submitting the Incoming Direct Rollover form (Form 210).
- Alternatively, use the Liquidated Funds Transfer form (Form 215).
- Be sure to contribute the balance within 60 days of the withdrawal to my529.
A rollover to my529 from another 529 plan must include documentation showing the portion that is principal and the portion that is earnings, if any. A rollover that does not include this documentation must be considered 100% earnings, according to federal law.
Know state benefits, consequences.
Non-Utah taxpayers and residents should determine (1) whether the state where they or their beneficiary pay taxes offers a 529 plan that provides tax benefits not available by investing in my529, and (2) the consequences of rolling funds over from that state’s 529 plan to my529.
How to roll over funds from my529 to another 529 plan or to an Achieving a Better Life Experience (ABLE) plan
- Submit a Withdrawal Request form (Form 300) to my529.
- Alternatively, instruct the other 529 plan or ABLE plan to submit a withdrawal or rollover request form to my529.
- Any request must be dated and signed. It must include the amount to be rolled over, to whom the check should be payable, and where the check should be sent.
- The my529 account will be closed if the entire account balance is rolled over.
- my529 requires a stamped or typed signature guarantee from a financial institution if an outgoing rollover request:
- is for $75,000 or more.
- is made in combination with withdrawal requests totaling $75,000 or more for the same beneficiary within a 30-day period.
- is made within 10 days of an account owner change.
- includes a signature on Form 300 that does not match the account owner’s signature on file.
Outgoing Rollovers to an Achieving a Better Life Experience (ABLE) Account
- A my529 account owner can rollover the balance in a my529 account to an ABLE account owned by the same beneficiary or member of the beneficiary’s family. Utah does not have an ABLE plan.
- A rollover will count toward the annual ABLE account contribution limit of $16,000. Any amount that exceeds the limit will be considered part of the beneficiary’s income.
- A rollover from a my529 account to an ABLE account is a nonqualified withdrawal for Utah state income tax purposes (See Tax considerations below).
- Ask your ABLE plan about their process for rolling over funds.
- Follow the withdrawal instructions above to rollover funds to an ABLE plan.
- The provision of federal law allowing rollovers from a 529 account to an ABLE account is currently scheduled to expire December 31, 2025.
Add back as income:
Utah taxpayers who roll over funds from my529 to another state’s 529 plan must add back the amount of the rollover as income on their Utah state income tax form for the taxable year the rollover is made.
A Utah taxpayer who rolls over funds to another state’s 529 plan is no longer eligible for Utah state income tax benefits.
Utah taxpayers must add back the amount of the rollover to an ABLE plan as income on their Utah state income tax form for the taxable year the rollover is made. However, Utah taxpayers can claim a Utah state income tax credit for contributions to an account in another state’s ABLE plan.