Overview
In 2024, we will see a host of new changes that could impact your 529 plans. See below for the most important changes and links for further information. And as always, please feel free to call us with any questions!
SECURE ACT 2.0 Updates:
This new change will allow you to roll over 529 plan money into a Roth IRA for the beneficiary, up to $35,000 over the course of the beneficiary’s lifetime.
Here is an article on the topic with more details: https://smartasset.com/financial-advisor/secure-act-529 or our blog post on SECURE updates from 2023 https://www.shepherdfinancialpartners.com/secure-2-0-savings-update/
Changes To FAFSA:
There are a handful of changes for the FAFSA form, including:
- A new application start date (This month!)
- A shorter form
- Changes to the Expected Family Contribution (the calculation of the amount of aid one family can receive
- Eligibility changes for families with 2+ children enrolled in college
- The filer of the FAFSA (now whichever parent provides the greater amount)
- Requirement to report family farms and small businesses
Here is an article on the topic with more details: https://www.nerdwallet.com/article/loans/student-loans/new-fafsa-what-parents-of-college-students-need-to-knowor read our blog post https://www.shepherdfinancialpartners.com/college-planning-free-application-for-federal-student-aid-fafsa/
Annual Gifting Limits will be Increasing:
Starting in 2024, the gift tax limit will increase to $18,000 for an individual (from $17k) and $36,000 for married couples (from $34K). The 5-year accelerated gift limits will also increase to $90,000 and $180,000, respectively.
Here is an article on the topic with more details: https://www.nerdwallet.com/article/taxes/gift-tax-rate#Gift%20tax%20limit%202024 or read our blog post on gifting https://www.shepherdfinancialpartners.com/year-end-strategies-for-gifting/
Disclosures
Alternative investments may not be suitable for all investors and involve special risks such as leveraging the investment, potential adverse market forces, regulatory changes and potentially illiquidity. The strategies employed in the management of alternative investments may accelerate the velocity of potential losses.
Investing in Real Estate Investment Trusts (REITs) involves special risks such as potential illiquidity and may not be suitable for all investors. There is no assurance that the investment objectives of this program will be attained.
Fund of hedge funds involve special considerations and risks not associated with an investment in traditional mutual funds. Each fund’s investment program is speculative and includes risks inherent with an investment in securities, as well as specific risks associated with the use of leverage, short sales, options, futures, derivative instruments, investments in “junk bonds”, non-US securities, illiquid investments and limited regulatory oversight. Each fund is a non-diversified fund and invests in Hedge Funds that may invest a substantial portion of the assets managed in an industry sector. Higher fees, potential investor income qualifications and strategy limitations must be considered in any suitability determination.
All investing involves risk including the possible loss of principle. No strategy assures success or protects against loss.
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
Securities offered through LPL Financial, member FINRA/SIPC. Shepherd Financial Partners and LPL Financial are separate entities. Additional information, including management fees and expenses, is provided on Shepherd Financial Partners, LLC’s Form ADV Part 2, which is available by request.
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