529 grandparents contribution tax report

[user17748216552]

Hi All,

I am the parent with 529 account for my two sons as Beneficiary. My parents (the grandparents) contributes to the 529 account. How could I file the tubortax about receiving this gift?

[MindyB]

You don’t need to do anything on your tax return. Since you are simply the owner of the account and your parents are the ones giving the money, there is nothing for you to report to the IRS or enter into TurboTax.

In the United States, the recipient of a gift (whether it's you or your sons' 529 accounts) never pays taxes on that gift or needs to report it. If the amount is very large, specifically over $19,000 per person in a single year, the person giving the money (the grandparents) might need to file a gift tax form, but even then, they likely won't owe any actual taxes.

[user17748216552]

If my parent gave this gift as a foreigner with less than $50,000 per kids. Do I need to report Form 3520?

[MindyB]

Since the total amount received from your parents is less than $100,000 for the year, you do not need to file Form 3520. The IRS only requires this informational form if gifts from a foreign individual (or related foreign persons) exceed that $100,000 threshold in a single calendar year. (See 3520 instructions here.)

Because your parents are giving less than $50,000 per child, the combined total stays under the limit, meaning there is no reporting requirement for you, the account owner, or your sons as the beneficiaries.