Since federal gift tax limited increased to $16K in 2022, can I add to a 529 plan that was superfunded in 2021

Forum|Forum|3 years ago
November 13, 2022
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Hi. I had the good fortune of being able to superfund my kid's 529 last year. That is I contributed the $15K limit in 2021 x 5 years for a $75K contribution. This avoids any gift/estate tax impact of the amount.

In 2022, the limit for a gift was raised to $16K.

Can I now contribute an extra $1K per year to the 529 without any gift/estate tax impacts? I would like to contribute another $1K x 4 years to the account if it doesn't have any other impact due to gift/estate tax items.

I have done multiple searches and can't find any articles or postings that talk about this situation.

Thanks

529 Plan

Best answer by Anonymous_

@188714 wrote:
Can I now contribute an extra $1K per year to the 529 without any gift/estate tax impacts?

Yes.

You can contribute the difference between the current annual exclusion and the $15,000 that is being prorated over five years.

For example, you can contribute $1,000 for 2022 ($16,000 - $15,000) and then $2,000 ($17,000 - $15,000) for 2023 since the annual exclusion is increasing to $17,000 in 2023.

Anonymous_Answer

Employee

@188714 wrote:
Can I now contribute an extra $1K per year to the 529 without any gift/estate tax impacts?

Yes.

You can contribute the difference between the current annual exclusion and the $15,000 that is being prorated over five years.

For example, you can contribute $1,000 for 2022 ($16,000 - $15,000) and then $2,000 ($17,000 - $15,000) for 2023 since the annual exclusion is increasing to $17,000 in 2023.