Gail Heinzman, CPA (Gail@HeinzmanGroup.com) responds to both Carol Arnott and Joyce Pearson (below).
The legal ownership of a 529 plan may be in the name of the child or the parent. As noted below, if the 529 account is an UGMA, it is the child’s property.
As to the comment by Joyce Pearson, that may apply in some cases but not all. A 529 plan may be an UTMA in which case it is an irrevocable gift. However, if the owner is the parent, he/she has the right to re-designate beneficiaries. This usually happens if an older child does not exhaust his/her 529 plan and younger child needs more money for education. In this case, the original designation was not an irrevocable gift. I have not seen a 529 with multiple owners or divided control. The terms of 529 plans vary. This issue should be addressed with their attorney.
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