Frequently asked questions

When you contribute to a WA529 Invest Plan account, any earnings are federal income tax-deferred until withdrawn. Then withdrawals used to pay for qualified education expenses are federal tax-free. State tax treatment varies. You should research what benefits may be available to you if you live in a state other than Washington.

If you live in a state other than Washington, you should research what, if any, state income tax benefits may be available to you.

No. If you are making a withdrawal to cover a qualified education expense for the beneficiary, you are not subject to federal or state income tax.

Qualified education expenses such as tuition, certain housing and food expenses, fees, books, supplies, computers and equipment required for the enrollment and attendance of the beneficiary at an eligible educational institution, which includes most postsecondary institutions. Review the Program Details Booklet for additional details on eligible expenses and withdrawals.

The earnings portion of a nonqualified withdrawal is subject to federal and applicable state income taxation and an additional 10% federal tax (Federal Penalty Tax). See the Program Details Booklet for details.

The available federal tax benefits for paying qualified education expenses through these programs must be coordinated to avoid the duplication of such benefits. Account owners should consult a qualified tax advisor regarding the interaction under the Internal Revenue Code (IRC) of the federal income tax education-incentive provisions when addressing account withdrawals.

Contributions to a WA529 Invest account may help reduce the taxable value of your estate. Learn more about gifting to an existing account. For additional details on tax benefits, we recommend consulting a tax advisor.

There is no federal income tax deduction for 529 plan contributions, regardless of where you live or which 529 plan you participate in.

Plan contributions are always made after any applicable tax.

Effective January 1, 2024, rollovers are permitted from an account to a Roth IRA without incurring federal or applicable state income tax or penalties, subject to the following conditions:

• The account must be open for 15 or more years, ending with the date of the Roth IRA rollover;
• Contributions and associated earnings that you transfer to the Roth IRA must be in the account for more than five years, ending with the date of the Roth IRA rollover;
• The Internal Revenue Code permits a lifetime maximum amount of $35,000 per beneficiary for Roth IRA rollovers;
• Account assets can be rolled over only into a Roth IRA maintained for the benefit of the beneficiary of the account;
• Account assets must be sent directly to the Roth IRA;
• Roth IRA income limitations are waived for Roth IRA rollovers; and
• The Roth IRA contribution is subject to the Roth IRA contribution limit for the taxable year applicable to the designated beneficiary for all individual retirement plans maintained for the benefit of the designated beneficiary.

The IRS may issue additional guidance that may impact Roth IRA rollovers, including the above referenced conditions.

State tax treatment of Roth IRA rollover is determined by the state where you file state income tax. Account owners and beneficiaries should consult with a qualified tax advisor before rolling over funds from their account to contribute to a Roth IRA. You are responsible for determining the eligibility of your account for a Roth IRA rollover, including tracking and documenting the length of time the account has been opened and the amount of assets in account eligible to be rolled into a Roth IRA.

Qualified higher education expenses means, generally, the cost of tuition, fees, books, supplies and equipment required for the enrollment or attendance of a beneficiary at an eligible educational institution, certain costs of housing and food (room and board), the cost of computer or peripheral equipment, certain software, and internet access and related services if used primarily by the beneficiary during any of the years the beneficiary is enrolled at an eligible educational institution, as well as certain additional enrollment and attendance costs of beneficiaries with special needs.

Qualified higher education expenses also include:
(a) tuition in connection with enrollment or attendance at a primary or secondary public, private or religious K-12 school (up to a maximum of $10,000 of distributions per taxable year per beneficiary from all Section 529 programs); (b) expenses for fees, books, supplies and equipment required for the participation of a beneficiary in a certified apprenticeship program; and (c) amounts paid as principal or interest on any qualified education loan of either the beneficiary or a sibling of the beneficiary (up to a lifetime limit of $10,000 per individual). Review the Program Details Booklet for additional information for these expenses. We encourage account owners to consult a qualified tax professional about how these withdrawals relate to their personal situations.

A nonqualified withdrawal is any withdrawal that does not meet the requirements of being a (a) qualified withdrawal, (b) taxable withdrawal or (c) rollover. The earnings portion of a nonqualified withdrawal is subject to applicable state and federal income taxation and the 10% additional federal penalty tax on earnings (the “Federal Penalty Tax”). See the Program Details Booklet for more info.

Your WA529 Invest account can be used at eligible colleges, universities, vocational schools, community colleges, graduate or postgraduate programs, apprenticeships and more.¹ Contact your school to determine whether it qualifies as an eligible educational institution or use the Federal School Code Search tool on the Free Application for Federal Student Aid (FAFSA) website.

Footnotes

1. ¹Withdrawals for registered apprenticeship programs can be withdrawn free from federal income tax and applicable state tax. You should talk to a qualified professional about how tax provisions affect your circumstances. Apprenticeship programs must be registered and certified with the Secretary of Labor under the National Apprenticeship Act.↩

You may request a withdrawal via your account online. Select the beneficiary you would like to withdraw the money for, click “Make a Withdrawal” on the lefthand navigation and follow the directions. You may also request a withdrawal using the Withdrawal Request Form.

The beneficiary must be enrolled at least half-time at an eligible postsecondary institution. For students living in housing owned and operated by the institution, the full invoice amount will be used to determine the qualified housing and food expenses. In the case of students living at home or in off-campus housing, the “cost of attendance” allowance for the individual institution will be used for the qualified housing and food expenses.

Computers and related technology such as internet access fees, software or printers are also qualified education expenses. The student must be the primary user of the equipment.

Federal tax treatment of a 529 plan’s qualified higher education expenses (QHEEs) includes the repayment of up to $10,000 (including principal and interest) on any qualified education loan of either a 529 plan designated beneficiary or a sibling of the designated beneficiary. To be a qualified expense, the loan repayment amount for an individual is subject to a lifetime limit of $10,000.¹ Get additional details in the Program Details Booklet.

Footnotes

1. ¹Withdrawals for student loans can be withdrawn free from federal and applicable state taxes. You should talk to a qualified professional about how tax provisions affect your circumstances.↩

Examples of a taxable withdrawal include a beneficiary’s death, permanent disability, receipt of a scholarship award or attendance at a military academy. For more information, review the Program Details Booklet.

A taxable withdrawal will be subject to applicable state and federal income tax on earnings, if any, but will not be subject to the 10% additional federal tax on earnings (the “Federal Penalty Tax”).

Taxable withdrawals that are not subject to the 10% federal penalty tax are withdrawals due to the beneficiary’s death, the permanent disability of the beneficiary, the beneficiary’s receipt of a scholarship award or certain other tax-free amounts, or the beneficiary’s attendance at a military academy. A taxable withdrawal will be subject to applicable state and federal income tax on earnings, if any.

Yes. Funds may be redeposited to your account within 60 days of the refund without penalty should a student need to withdraw from a class. The recontributed amount cannot exceed the amount of the refund.

Anyone with a valid Social Security Number or Taxpayer Identification Number can be the beneficiary, including the account owner. Learn more about who can open, benefit from and contribute to a WA529 Invest account.

Beneficiaries can include your son or daughter, grandchild, niece/nephew, cousin, family friend, etc.

There’s no cost associated with opening a WA529 Invest account or owning more than one account. You could open a different account for each child. And each individual child could have multiple accounts owned by different account owners (e.g., Grandma opened an account for Billy and Dad opened an account for Billy, so there can be two accounts with Billy as the beneficiary).

You might do this to align investment strategies with the time frame each child will begin using the funds. For example, an older child’s account could be more conservatively invested to help protect your contributions as they near college, whereas a younger child’s account might be invested to balance growth and income strategies during a longer time frame.

Multiple accounts can also aid in estate planning by ensuring that college funds are allocated appropriately to each beneficiary upon the death of the account owner. But if you’d like to stick to one account, you can change beneficiaries at any time and at no additional cost.

Yes. A beneficiary may have more than one WA529 Invest account. However, an account owner can have only one account for each beneficiary.

For example, a beneficiary may have an account owned by their parent and/or grandparent and/or aunt, etc. There is an overall maximum account balance limit for accounts for a beneficiary in the plan and any additional accounts in other Washington Section 529 programs of $500,000.

Yes. You can change the beneficiary of your account at any time or transfer a portion of your investment to a different eligible beneficiary. The new beneficiary must be an eligible member of the previous beneficiary’s family.

For more information, read the form on how to change your beneficiary.

Here’s where you find performance data for WA529 Invest Investment Portfolios.

WA529 Invest offers a variety of investment options to fit your life situation, risk tolerance and savings goals. These vary in investment strategy and degree of risk, allowing you to select a portfolio or combination of portfolios that fit your needs and savings goals.

To compare our WA529 Invest Portfolios, visit our Investment Comparison page. For more information on the investment objectives, risks, charges and expenses, read the Program Details Booklet.

Yes. Each time you make a contribution, you may select from any of the WA529 Invest portfolios. Once invested in a particular portfolio, contributions and earnings may be transferred to another portfolio twice per calendar year or upon transfer of funds to a plan account for a different eligible beneficiary (see the Program Details Booklet for more information).

To transfer funds between investments, log in to your account, click “View Details” for your beneficiary, click “Change Investment Options,” then click “Continue” in the Exchange Now section. You may also request and submit by mail the Change of Investment Form.

A WA529 Invest account can be started with any amount. How much you need to save will depend on what you plan to use the money for and when.

A few helpful tools:

• Check out the College Savings Calculator to estimate the cost of college.
• Use our College Planning Calculator to see how your savings could add up over time.

You can contribute to a WA529 Invest account by any of the following: check, electronic funds transfer, establishing a recurring contribution, establishing payroll direct deposit, rollover from another state’s 529 plan account or redemption proceeds from a Coverdell Education Savings Account or qualified U.S. savings bond. Your contribution will be invested according to your allocation instructions, which you may change at any time online, by telephone or by requesting and submitting the Change of Investment Form. For more information, click here.

Contributing to an existing WA529 Invest account is easy and secure with our online Ugift^® platform. Gift contributions can also be made by check and mailed in.

For the tax year 2025:

• There’s no federal gift tax on contributions you make up to $19,000 per year if you’re a single filer or $38,000 if you’re a married couple.
• You can also accelerate your gifting with a lump-sum gift of $95,000 if you’re a single filer or $190,000 if you’re married and prorate the gift over five years per the federal gift tax exclusion.
• You can gift this amount to as many individuals or beneficiaries as you like, free from federal income tax.

Consult your tax professional for more details. Learn more about gifting here.

To view your transaction history, log in to your account, click “View Details” for your beneficiary and scroll down to the transactions section. You can always speak to one of our college savings specialists at 844-529-5845 Monday through Friday, 8 a.m.–7 p.m. PT.

There is no maximum WA529 Invest contribution limit. However, there is an overall maximum account balance limit of $500,000, which applies to all accounts opened for a beneficiary in the plan and any additional accounts in other Washington Section 529 programs. Accounts that have reached the maximum account balance limit may continue to accrue earnings.

WA529 Invest accounts can be opened with any amount, and contributions of any amount can be made. Check out our unique gifting feature to see how you can easily and securely ask for and manage gift contributions to your WA529 Invest account.

Assets in a parent-owned 529 account have less of an impact on financial aid than some other savings methods. The Student Aid Index (SAI), formally known as Expected Family Contribution (EFC), calculations for financial aid generally factor parent assets outside of retirement savings at approximately 5%, whereas student assets are generally factored in at 20% or more. Therefore, a parent-owned 529 account may have less of an impact on financial aid eligibility than assets owned by the student.¹

Footnotes

1. ¹The treatment of investments in a 529 savings plan varies by school. Assets are typically treated as the account holder’s and not the student’s. (Student assets are generally assessed at 20%, whereas parental assets are generally assessed at 5.6%.) Any investments, including those in 529 accounts, may affect the student’s eligibility to get financial aid based on need. You should check with the schools you are considering regarding this issue.↩

If the beneficiary receives a scholarship that covers the cost of qualified expenses, you can withdraw the funds from your account up to the amount of the scholarship without incurring the 10% federal tax penalty on the earnings portion. However, the earnings portion will be subject to federal and applicable state income tax. If the amount withdrawn exceeds the amount of the scholarship, the earnings portion of the amount withdrawn will be subject to the additional 10% federal penalty tax. Please consult with a qualified tax advisor or consultant.

Historically, withdrawals from grandparent-owned 529 plans have been considered untaxed income to the student and added to the student’s adjusted gross income on the FAFSA. Beginning with the 2024–2025 FAFSA, withdrawals for grandparent-owned 529 plans will no longer need to be reported on the FAFSA or negatively affect the student’s eligibility for federal financial aid. FAFSA simplification is subject to change. You should check with the schools you are considering regarding this issue. For assistance or help completing FAFSA, click here.

Anyone with a valid Social Security Number or Taxpayer Identification Number who is at least 18 years of age can open a WA529 Invest account. Accounts can be opened online.

There are no sales charges, startup fees or maintenance fees associated with WA529 Invest account. For details on total annual asset-based fees, comprised of the underlying investment expenses for each investment portfolio and the plan manager fee, review the Plan Fee Table in the Program Details Booklet.

Yes. Whether you have recently moved to the state, have an underperforming or higher-cost 529 plan or just want to simplify, consolidating 529 accounts into WA529 Invest is easy. You can transfer funds from another 529 plan to your WA529 Invest account for the same beneficiary once within a 12-month period without incurring tax penalties.

Consolidating education savings into WA529 Invest also gives you a single view of your savings and performance as well as single-step payments to colleges, universities, etc.

You may also save money that can go right back into your college fund. WA529 Invest expenses are among the lowest in the country.¹ You pay no sales charges, startup fees or maintenance fees.

The 529 plan from which you are transferring funds may be subject to different features, costs and surrender charges. As such, you should consult your tax advisor or the other 529 college savings plan prior to making any decisions. For more information, see how to manage an incoming rollover from another 529 saving plan account.

Footnotes

1. ¹Source: ISS Market Intelligence 529 College Savings Fee Analysis Q4 2024. DreamAhead (now WA529 Invest) Program’s average annual asset-based fees are 0.27% for all portfolios compared to 0.51% for all 529 plans.↩

Log in to sign up for electronic delivery for statements, transactions, profile confirmations and tax forms.

For information, please click here.

If you would like to establish an UGMA/UTMA account, please contact our call center at 844-529-5845 to obtain an application.