Quote:
Originally Posted by Jim in CT
Good question, and I know the answer. If you withdraw that money for any reason other than college expenses, you (1) have to pay income taxes on the earnings (for which you have not yet paid taxes), and (2) you pay an additional 10% penalty to the feds...
The big advantage of 529 plans is that if you DO use it for college, you never have to pay any taxes on your earnings. You already paid taxes on your contrubutions, but your gains are tax-free if used for college.
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Gracias.
the Duct tape sales is funny ...
So .... you get the boat yet????