IRA Rollover To Illinois 529 Accounts
Hi.
I’m 70 years old. I live on a good pension and have two additional IRAs (not Keogh) with some funds (not a lot) that (I am told) I will have to draw down next year. I would like to roll these over to an Illinois 529 Account for my grand children’s college education. I would like to NOT have to pay taxes on this money, which would decrease its real value to them.
Can you provide advice on this?
Terry Says
Sorry but you can’t “roll over” an IRA to a 529 plan! You must withdraw and pay taxes on those withdrawals from a traditional IRA –and THEN gift them to your grandchildren.
BUT, I suggest that maybe you hang onto that money since you never know how much you will need in your retirement. Then if you have extra money when the grandchildren are ready for college, you can use your RMDs to gift money to pay some tuition directly.
