Can You Give Directly to an Unrelated Child's 529 Plan?

Do you have to be related to the beneficiary to give?

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During the holiday season, you may be in search of creative gift ideas for a child who’s unrelated to you. If you’re used to buying toys and gadgets, you might instead want to consider a more meaningful gift, like contributing to a 529 qualified tuition plan. Doing so can help the student (and their family) prepare for the high cost of private school or college.

While a young child may not realize the benefit of your gift initially, they’re sure to thank you when it comes time for them to start college.

So how do you go about contributing to an unrelated child’s 529 plan? And are there tax implications of doing so? We’ll walk through the answers to these questions below.

What Are 529 Plans?

These plans are state-sponsored, tax-advantaged savings accounts designed to help families save for educational expenses. There are two types of 529 plans: prepaid tuition plans, which allow you to buy credit for future tuition at today’s prices; and education savings plans, which involve investing money so that it can grow over time. Education savings plans tend to be more common and work a lot like Roth individual retirement accounts (IRAs), with after-tax contributions from parents and others.

Legally known as "qualified tuition plans," 529 plans offer significant tax benefits when the funds are used for a variety of “qualified” college and private K-12 expenses. Contributions to 529 plans are invested and grow tax-free until they are needed to cover the beneficiary’s educational expenses.


Qualified expenses that can be paid with education savings plans may include tuition, books, room and board, and classroom materials.

Can I Contribute to an Unrelated Child’s 529 Plan?

You can contribute to 529 plans that are set up for children who are not related to you. “Many of our clients who are in their 30s and 40s and don’t have children of their own like to take advantage of this,” Eric Roberge, CFP and founder of Beyond Your Hammock, said in an email to The Balance.

Regardless of who owns the 529, you’ll be able to make direct deposits into the account from your bank. This way, you won’t have to hand over cash to another guardian and hope they deposit it into the plan. Most custodians, including well-known money-management firms Vanguard and Fidelity, can give you specific instructions on how to contribute online or make out a gift check for accounts owned by others.

“Many plans have online gifting pages where the account owner can share the account information with anyone who wants to contribute, so that people can gift money directly and in many cases, claim any available tax benefits for their contributions,” said Ann Garcia, a CFP who works at Independent Progressive Advisors, in an email to The Balance.

The states that sponsor 529 plans determine the contribution limits, which usually range from $200,000 to more than $500,000. Some states don’t set contribution limits at all.


Before you contribute to a child’s 529 plan, it’s important to familiarize yourself with the contribution limits in the state the plan has been opened in.

You can find contribution limit information on relevant state-specific 529 plan websites like CollegeAdvantage in Ohio or NextGen 529 in Maine.

How Will Giving to a Child’s 529 Plan Affect Taxes?

You may be eligible for a state income tax deduction if you give to a child’s 529 plan. When it comes to federal taxes, however, there is no deduction allowed. But before you make a gift to a 529, be sure to consider the following.

Gift Tax

“If you go over the annual gifting limit, you’ll need to account for that on your tax return and pay gift taxes,” said Roberge. In tax year 2021, an individual, in general, can give gifts to one person of $15,000 for the year, while a married couple can give one person $30,000. In tax year 2022, the limit increases to $16,000 from an individual or $32,000 from a married couple.


Qualified tuition 529 accounts come with a special contribution provision known as “superfunding.” With this provision, you can contribute up to five years of gifts in one year. According to the Internal Revenue Service (IRS), you can treat the contribution (for tax purposes) as if you had made it ratably over five years. In other words, for each of the five years following (and inclusive of) the contribution, you would report on your taxes one-fifth of the contribution as a gift.

This means that if you’re feeling extra generous, you can gift up to $75,000 to an unrelated child’s college fund without counting it toward your lifetime gift-tax-exclusion limit. Even though you won’t be subject to gift tax for that amount, you’ll have to wait six years to contribute more.

Key Takeaways

  • 529 plans designed to help save for education expenses in a tax-friendly way.
  • You can contribute to a child’s 529 plan, even if you’re not related.
  • While giving to a child’s 529 plan can help you save on state income taxes, it doesn’t generally affect federal taxes.
  • If you go over the annual gifting limit, you’ll be on the hook for paying gift taxes unless you take advantage of the 529 plan superfunding mechanism.
  • In the event that you superfund a 529 plan and contribute up to five years of gifts in a single year, you’ll be exempt from gift taxes.
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The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
  1. Securities and Exchange Commission. "An Introduction to 529 Plans."

  2. Internal Revenue Service. "Instructions for Form 709," Page 3.

  3. Internal Revenue Service. "What's New - Estate and Gift Tax."

  4. Internal Revenue Service. "Instructions for Form 709," Page 7.

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