529 Change Beneficiary to Cousin: A Comprehensive Guide

If you're a 529 plan holder and you want to change the beneficiary to your cousin, here's what you need to know.

Why Change the Beneficiary?

There are several reasons why you might want to change the beneficiary of your 529 plan. For example, you may have:

• Had a falling out with the original beneficiary
• Gotten married and want to name your spouse as the beneficiary
• Had a child and want to name them as the beneficiary
• Changed your mind about who you want to inherit your assets

How to Change the Beneficiary

Changing the beneficiary of a 529 plan is a relatively simple process. You can typically do it online or by contacting the plan provider by phone or mail.

To change the beneficiary online, you will need to log into your account and follow the instructions. To change the beneficiary by phone or mail, you will need to contact the plan provider and request a change of beneficiary form.

Once you have completed the change of beneficiary form, you will need to mail it to the plan provider. The plan provider will then process the change and send you a confirmation notice.

What Happens to the Funds in the 529 Plan?

When you change the beneficiary of a 529 plan, the funds in the plan will be transferred to the new beneficiary's account. The new beneficiary will then be able to use the funds to pay for qualified education expenses.

What to Consider Before Changing the Beneficiary

Before you change the beneficiary of your 529 plan, there are a few things you should consider:

• The age of the new beneficiary. If the new beneficiary is under the age of 18, you will need to appoint a custodian to manage the account until the child reaches the age of majority.
• The tax implications of changing the beneficiary. If you change the beneficiary to someone other than your child, the funds in the plan may be subject to gift tax.
• The estate planning implications of changing the beneficiary. If you change the beneficiary to someone other than your child, the funds in the plan may be subject to estate tax.

Tips for Changing the Beneficiary

Here are a few tips for changing the beneficiary of your 529 plan:

• Make sure you have the correct information for the new beneficiary. You will need to provide the new beneficiary's name, address, and Social Security number.
• Review the terms of your 529 plan before you change the beneficiary. Make sure you understand the rules and regulations governing the plan.
• Keep a copy of the change of beneficiary form for your records. This will help you prove that you made the change if there is ever any dispute.

Frequently Asked Questions

Here are some of the most frequently asked questions about changing the beneficiary of a 529 plan:

• Can I change the beneficiary of my 529 plan more than once? Yes, you can change the beneficiary of your 529 plan as many times as you want.
• What happens if I die before I change the beneficiary of my 529 plan? The funds in the plan will be distributed to the beneficiary named on the account.
• Can I use a 529 plan to pay for my own education expenses? No, you cannot use a 529 plan to pay for your own education expenses.

Conclusion

Changing the beneficiary of a 529 plan is a relatively simple process. However, it is important to understand the rules and regulations governing the plan before you make any changes. By following the tips in this article, you can ensure that your 529 plan is used to benefit the people you care about most.

Additional Resources

• 529 Plans
• Changing the Beneficiary of a 529 Plan
• 529 Plan FAQs

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