I am custodian for my 16 yr old grandson's 529 Edu Plan acct. I have received a 1099-INT showing $63 in int and no fed tax withheld. Does this need to be reported?

mq2 · ‎June 6, 2019

IreneS · ‎June 6, 2019

UPDATED FOR TAX YEAR 2019

No - The earnings generated in a 529 plan are not subject to federal or state income taxes while the funds stay in the account. Contributions to a 529 plan are made with after-tax dollars. Earnings within a 529 college savings plan occur on a tax-deferred basis.

When the money is used for qualified education expenses, the distributions from the 529 plan are not subject to federal or state income taxes.

[Edited | 4/6/2020 | 11:58am PDT]

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

View solution in original post

IreneS · ‎June 6, 2019

UPDATED FOR TAX YEAR 2019

No - The earnings generated in a 529 plan are not subject to federal or state income taxes while the funds stay in the account. Contributions to a 529 plan are made with after-tax dollars. Earnings within a 529 college savings plan occur on a tax-deferred basis.

When the money is used for qualified education expenses, the distributions from the 529 plan are not subject to federal or state income taxes.

[Edited | 4/6/2020 | 11:58am PDT]

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

Expert does your taxes

Do it yourself

Resources

Support

Expert does your taxes

Do it yourself

Resources

Support

Expert does your taxes

Do it yourself

Resources

Support

Expert does your taxes

Do it yourself

Resources

Support

I am custodian for my 16 yr old grandson's 529 Edu Plan acct. I have received a 1099-INT showing $63 in int and no fed tax withheld. Does this need to be reported?