May 29 is National 529 Day—an annual nudge to think about how you are saving for the future education of any children in your life. It is also an opportunity to learn about how 529 plans fit into your long-term goals.
For Ohio residents, contributions are a tax deduction, saving 2.75% in tax. An annual $4,000 contribution per beneficiary saves $110 in tax. The larger, long-term benefit is that these funds grow tax-free as long as withdrawals are used for qualifying expenses.
If you already have a 529 plan in place, here is some good news: recent legislation has made these accounts more powerful than ever.
Starting in 2026, the One Big Beautiful Bill Act (OBBBA) doubles the annual K-12 distribution limit from $10,000 to $20,000 per beneficiary, which is a big win for families with children in private or religious schools. The OBBBA also expanded qualified expenses to include credentialing costs, such as fees for testing and continuing education required to earn or maintain a professional credential like a RN, CPA, or JD. That makes 529 plans useful well beyond traditional college.
Other qualified expenses include:
- Tuition and fees at colleges, universities, trade schools, and vocational programs
- Room and board (for students enrolled at least half-time)
- Books, supplies, computers, software, and internet service
- K-12 tuition
- Registered apprenticeship programs
- Student loan repayments (up to $10,000 lifetime per beneficiary)
And if your child ends up not needing all the funds? Unused 529 money can now be rolled into a Roth IRA for the beneficiary, up to $35,000 lifetime, giving them a meaningful head start on retirement savings. There is no reason for a dollar saved in a 529 to go to waste.