A Fidelity College Savings Plan, or 529 Plan, is a flexible account specifically designed for college savings. Qualified distributions from a 529 Plan account are federal income tax-free. The plan is named after Section 529 of the IRS code. Fidelity manages three state-sponsored 529 Plans, which are designed for college savings.What are 529 plan rules?
To qualify as a 529 plan under federal rules, a state program must not accept contributions in excess of the anticipated cost of a beneficiary's qualified education expenses. At one time, this meant five years of tuition, fees, and room and board at the costliest college under the plan, pursuant to the federal government's "safe harbor" guideline.Should you transfer 529 college savings to an ABLE account?
Yes, as of 2018 Congress passed the ABLE Financial Planning Act which allows you to rollover money from a 529 College Savings account into a beneficiary's (or family member's*) ABLE account without being penalized. There is a $15,000 rollover limit (less the current tax-year ABLE contributions).