How Long Can You Contribute to a 529 Plan?

A 529 plan is a tax-advantaged savings vehicle for future educational expenses. Contributions grow on a tax-deferred basis, meaning investment earnings are not taxed annually. When funds are withdrawn for qualified education costs, both contributions and earnings are distributed tax-free. This structure helps accumulate funds for various educational pursuits, from elementary school to higher education.

Federal and State Contribution Rules

There is no federal age restriction on a beneficiary or a time limit for contributions to a 529 plan. Contributions can continue as long as the account remains open and the designated beneficiary is alive, provided funds are for qualified educational expenses. This federal flexibility allows a 529 plan to be funded for many years.

While the IRS does not impose annual contribution limits, 529 plan contributions are considered gifts for federal tax purposes. For 2025, individuals can contribute up to $19,000 per beneficiary without triggering federal gift tax implications or needing to file a gift tax return. Married couples filing jointly can contribute up to $38,000 per beneficiary.

For larger contributions, “superfunding” allows an individual to contribute up to five years’ worth of gifts at once, totaling $95,000 in 2025, or $190,000 for married couples. If contributions exceed these annual exclusion amounts, the excess must be reported on IRS Form 709, counting against the donor’s lifetime gift tax exemption. This exemption is substantial, so most individuals will not owe gift tax even on larger contributions.

State-sponsored 529 plans establish aggregate lifetime contribution limits per beneficiary, which vary significantly by state. These limits range from approximately $235,000 to over $575,000 and cover the estimated cost of higher education, including graduate school, within that state. Once the combined balance in all 529 plans for a single beneficiary within a state reaches this cap, no further contributions can be made to plans administered by that state.

Note that if investment earnings cause an account balance to exceed the state’s maximum, no penalties are incurred, as the limit applies strictly to contributions. Many states also offer tax benefits, such as deductions or credits, for contributions to their specific 529 plans. These state-level benefits often have their own annual contribution limits to qualify for the tax incentive.

Account Longevity and Fund Utilization

Federally, there is no age limit for a beneficiary to use 529 funds, nor a mandated account termination timeline. This flexibility allows 529 accounts to remain open for many years, providing time for the beneficiary to pursue various educational paths, including undergraduate, graduate, or vocational training, even if those plans evolve over time.

While federal rules are flexible regarding account longevity, some state-sponsored prepaid tuition plans may impose specific age limits or timeframes for fund use. For instance, certain prepaid plans might require funds to be used by a specific age, such as 30, or within a set number of years after high school. However, these state-specific limitations are less common for 529 college savings plans.

Funds in a 529 plan must be used for qualified educational expenses to maintain tax-free withdrawal status. These expenses include costs associated with eligible educational institutions, such as accredited colleges, universities, vocational schools, and other post-secondary institutions.

Tuition and fees required for enrollment or attendance.
Books, supplies, and equipment necessary for coursework.
Room and board expenses for students enrolled at least half-time, capped by the institution’s cost of attendance for housing and food.
Purchase of computers, peripheral equipment, educational software, and internet access used primarily by the beneficiary for studies.
Up to $10,000 per year for K-12 tuition per beneficiary.
Expenses for registered apprenticeship programs, including fees, books, supplies, and equipment.
As of July 4, 2025, additional K-12 expenses, such as books, materials, and tutoring.

Options for Remaining Funds

If a 529 plan has funds no longer needed for the original beneficiary’s education, several options are available to manage these assets without tax penalties. One approach is to change the account’s beneficiary. This can be done tax-free if the new beneficiary is an eligible family member of the original beneficiary.

The IRS defines eligible family members broadly:

Spouse
Children, stepchildren, foster children, adopted children
Siblings, stepsiblings
Parents, stepparents
Aunts, uncles, nieces, nephews
First cousins

This flexibility ensures funds can be redirected to another family member who can benefit from the educational savings.

Another option is rolling over funds from one 529 plan to another. This can be done tax-free for the same beneficiary once every 12 months. If the rollover is for a different eligible family member, there is no frequency restriction. To qualify as a tax-free rollover, funds must be transferred to the new 529 plan within 60 days of withdrawal from the original account.

A new provision, effective January 1, 2024, allows a limited amount of unused 529 funds to be rolled over to a Roth IRA. This offers an additional avenue for funds not expended on education. The lifetime maximum amount that can be rolled over to a Roth IRA for a single beneficiary is $35,000.

Specific conditions must be met for this Roth IRA rollover. The 529 account must have been open for at least 15 years, and any contributions or earnings rolled over must have been in the 529 account for more than five years. The annual amount rolled over cannot exceed the Roth IRA annual contribution limit for that year ($7,000 for 2025, or $8,000 for individuals aged 50 or older). Additionally, the beneficiary must have earned income at least equal to the amount rolled over in that year, though Roth IRA income limitations are waived for this rollover.

If funds are withdrawn from a 529 plan for non-qualified expenses, the earnings portion becomes subject to federal income tax at the account owner’s ordinary income tax rate. An additional 10% federal penalty tax applies to these earnings. Original contributions are not taxed or penalized, as they were made with after-tax dollars. Certain exceptions can waive the 10% federal penalty, though the earnings portion remains taxable. These exceptions include:

Death or disability of the beneficiary.
Beneficiary receiving a tax-free scholarship.
Beneficiary attending a U.S. Military Academy.