I am finding differing answers for this question so would appreciate any input
Are 529 Savings/Prepaid College Trust custodial accounts to be listed as a parent or student investment on FAFSA?
Thank you.
For a student who must report parental information, they are listed as a parent investment in item 91.
Is it a parent- or student-owned 529 or a grandparent-owned 529?
The parent is the account holder with student as beneficiary.
Based on your posts, I assume that you are talking about a custodial 529 account where the parent is the custodian and the minor student is the owner and beneficiary.
See http://thechoice.blogs.nytimes.com/2013/01/16/guidance-office-fafsa-3/
Q.
— Victoria Hamilton
A.
The College Cost Reduction and Access Act of 2007 changed the treatment of 529 college savings plans starting with the 2009-10 award year. Any 529 plan that is owned by a dependent student or the dependent student’s parent is reported as a parent asset on the Fafsa. This includes the 529 plans for siblings.
Any 529 plans that is owned by an independent student or the independent student’s parent is reported as a student asset on the Fafsa.
Distributions from such 529 plans are not reported as income on the Fafsa.
Any 529 plan that is owned by someone else is not reported as an asset on the Fafsa, but any distributions from such a 529 plan are treated as income to the beneficiary.
If the parents are divorced and the 529 plan is owned by the noncustodial parent, the 529 plan is not reported as an asset, if the student is dependent. Distributions from such a 529 plan are treated as income to the beneficiary. If the student is independent, it is reported as a student asset and the distributions are ignored.
@lex2727 Do you have other children who have parent-owned 529 accounts as well?