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Can I gift the 529 college plan to my son who will not attend college or vocation school? Or, can I take the distribution and set up an IRA?

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Barby
Level 1

The account has about $17000.  Do I get taxed on earnings only.  Am I taxed on the Distribution?

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If it it YOUR 529, then you can take the distribution. The earnings are taxable and subject to a 10% penalty. You can then do anything you want with it, including gifting to me, as well as your son. You can NOT convert it to an IRA. You can use the money to add to an IRA, assuming you meet all the qualifications for an IRA. 

Add https://www.irs.gov/pub/irs-pdf/p970.pdf to your reading list. 

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

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All-Star

If it it YOUR 529, then you can take the distribution. The earnings are taxable and subject to a 10% penalty. You can then do anything you want with it, including gifting to me, as well as your son. You can NOT convert it to an IRA. You can use the money to add to an IRA, assuming you meet all the qualifications for an IRA. 

Add https://www.irs.gov/pub/irs-pdf/p970.pdf to your reading list. 

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

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Barby
Level 1
Thank you - best answer and very clear
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@Barby

Are you looking for the TurboTax forum? You are a bit lost on the internet. TurboTax is found at this link:

https://ttlc.intuit.com/community/file-with-turbotax/discussion/03/303


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Barby
Level 1
No - I wasn't looking for Turbo Tax.  I have Pro Series.  Thanks anyway
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