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Overcontributed to 529 account

Forum|Forum|3 years ago
January 10, 2023
2 replies
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I realized that I overcontributed to my child's 529 account in 2021.

I assume I need to pay a penalty of some kind as a result. Is preparing the proper filing and assessing the penalty something TurboTax will help me with as part of my return?

Or should I consult a tax professional separately and/or do something else to correct this error?

Best answer by dmertz

In what way did you overcontribute? There is no contribution limit, but if you exceed the annual gift-tax exclusion amount then you'll need to file a gift-tax return, Form 709. The amount that you are over the annual exclusion amount will add to your lifetime total for estate- and gift-tax purposes.

Or are you asking about a state aggregate limit?

A

Anonymous_

Employee

Stay tuned, I will page @dmertz who can most likely help.

D

dmertzAnswer

Employee

In what way did you overcontribute? There is no contribution limit, but if you exceed the annual gift-tax exclusion amount then you'll need to file a gift-tax return, Form 709. The amount that you are over the annual exclusion amount will add to your lifetime total for estate- and gift-tax purposes.

Or are you asking about a state aggregate limit?