Yes, a 529 plan account owner can change the beneficiary to a family member at any time without tax consequences. The IRS defines family members broadly, including blood relatives, relatives by marriage, and relatives by adoption. Qualified family members include:
- A spouse
- A son, daughter, stepchild, foster child, adopted child, or a descendent
- A sibling, first cousin, grandparent, aunt, uncle, or even yourself
The money can be used for qualified education expenses without incurring income taxes or penalties.
For example, you can use a single 529 plan account to save for more than one child if you change the beneficiary when it's time to pay for your next child's college expenses.
