529 plans are tax-advantaged savings plan designed to encourage saving for future college costs. There are federal tax and some state tax advantages depending on the state you live in. Additionally, if your child does not go to college you can change the beneficiary penalty free. To avoid taxes and penalties, your new beneficiary must be a member of the family of your original beneficiary. Do check with your tax advisor before changing beneficiaries.

Investing in a 529 plan has tax benefits. These benefits vary depending on the state and the 529 plan. You should make sure you understand the tax implications of investing in a 529 plan and consider whether to consult a tax adviser.

However, in general the growth on a 529 Plan is tax free. In addition, Arizona residents are eligible for a $2,000 deduction to gross income per taxpayer, or $4,000 for those married, filing jointly based on contributions. Arizonans also enjoy a high maximum contribution limit of $494,000 per beneficiary, effective October 1, 2019.

Any U.S. taxpayer can open a 529 plan for ANYONE – including, yourself.  Account owners do not need to live in the state sponsoring their 529 plans, since most do not have state residency requirements. Family and friends can contribute to an existing 529-college savings account.

Generally, up to $15,000 per year, which you can front load it for the first five years. But check with a qualified tax advisor as to your personal circumstances.

In general, Plan funds may be used for eligible college expenses: tuition, fees, room board, textbooks, school supplies and a computer (if required by the institute). However, there are limits and some restrictions.  Again, check with a qualified tax advisor.

In addition, the federal SECURE Act allows 529 Plan funds to pay for certain apprenticeship programs and to pay principal and interest on qualified higher education loans for the beneficiary or any of the beneficiary’s siblings– up to a lifetime maximum of $10,000 per individual.

Federal law also allows you to make withdrawals from a 529 college savings account up to $10,000 each year per beneficiary for tuition expenses in connection with enrollment and attendance at an elementary or secondary public, private or religious school (“K-12 tuition”).   Arizona taxpayers should consult their tax advisors before making a withdrawal for K-12 tuition and/or before making a contribution which they intend to ultimately withdraw for K-12 tuition. It will require action by the Arizona State Legislature to extend favorable Arizona state tax treatment to withdrawals for K-12 tuition taken from an Arizona Family College Savings (529) Plan account. Check with a qualified tax advisor before making any withdrawals from a 529 plan.

There are 19 state-sponsored plans and 28 other 529s with investment options insured by the FDIC or National Credit Union Administration (Savingsforcollege.com). Only 529 Plans that have federal guarantees are insured against loss, up to certain limits. However, you should be award that generally these kinds of investments don’t offer the highest rates of return long-term.

Not if you re-contribute it to the same plan by July 15, 2020 (this applies to refunds received from February 1 to May 15).

Generally 529 Plans only allow one owner. However, most of them will allow for duplicate statements to go to more than one party. Be sure your divorce decree or Agreement provides for the following:

1. Both of you must agree on investment decisions.
2. The owner must provide duplicate statements to the non-owner each month;
3. The 529 Plan can only be used for those expenses allowed by the Plan and that are mutually agreed upon by each of you.
4. When your child is through with college, that each of you has the right to direct the disposition of 50% of any remaining balance.

Yes. Check with your financial advisor for the appropriate arrangements.

It depends on your Divorce Decree or Agreement. Check to see if it says that both of you get an equal say or you can each direct 50% of any balance. If it does not, then the owner gets to direct the disposition and can even keep the funds themselves.