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Can I open an account in New Yorks 529 College Savings Program Direct Plan with the money from my childs UGMA/UTMA account?

April 26, 2017account child College Savings new york Plan program UGMA UTMA

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Can I open an account in New Yorks 529 College Savings Program Direct Plan with the money from my childs UGMA/UTMA account?

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You may use money from a Uniform Gifts/Transfers to Minors (UGMA/UTMA) account to open an account in New York’s 529 College Savings Program Direct Plan, but keep in mind that you may incur capital gains taxes from the sale of the assets currently held in the UGMA/UTMA account. Since any money gifted to a child in an UGMA/UTMA account is irrevocable, the 529 should be opened as a separate “UGMA/UTMA 529” account. You should consider opening a separate 529 account for the same child if you wish to make additional contributions of non-UGMA/UTMA money. Any money that you contribute to the “UGMA/UTMA 529” account will be considered owned by the child and you will not be able to change the beneficiary of this account.