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Frequently Asked Questions

General

Yes. Typically you can move funds into or out of your Virginia529 accounts through a rollover, transfer or investment option change. For details, please see the Move Funds page.

An account owner may initiate an investment option change twice per calendar year per student. If there is a change in student, an investment option change can also be made at the same time.

Yes, an account owner may have multiple portfolios for the same student and each portfolio is a separate account. The account owner may not have two of the same portfolios for the same student. For instance, an account owner could not have two 2039 portfolios for the same student but could have a 2039 portfolio and an ESG Core Equity portfolio for that same student.

The only insured portfolio is the FDIC-Insured Portfolio and this portfolio is insured by the Federal Deposit Insurance Corporation (FDIC) to the fullest extent permitted by law. All other Invest529 portfolios are subject to market risk including loss of principal.

You may choose any of the Invest529 portfolios, however it's important to keep in mind the shorter the time horizon when the money will be needed for private, public, or religious K-12 schools when choosing a portfolio. There are Invest529 portfolios that have conservative and stable investment strategies as well as more aggressive options, but it is ultimately up to you to choose the portfolio that best meets your risk tolerance and time horizon.

Target Enrollment portfolios are designed for college savers. You pick the date your student will be graduating from high school and over time the investments go from more aggressive to more stable. 

For more information about Target Date Portfolios, view the blog article: Three Things to Know About: Target Enrollment Portfolios.

Contributions may be made online at Virginia529.com or by check, online bill pay or, direct deposit (please consult your employer regarding direct deposit policies).

First, read about the programs Virginia529 offers, specifically the Program Description for the program(s) in which you are interested. After you have selected a program, select "Open an account" from the top of any page to gather the information you need to get started. After you create an online user profile, you can complete the application for Invest529. To open a CollegeAmerica account, contact your financial advisor or visit americanfunds.com.

Any non-retirement investment or savings account may affect eligibility. For accounts owned by parents and dependent students, the Free Application for Federal Student Aid (FAFSA) assesses 529 assets at a maximum of 5.64 percent of the value when calculating the Expected Family Contribution (EFC) for financial aid eligibility. Accounts owned by other parties will impact eligibility differently. For more information, consult studentaid.gov or an educational financial aid advisor.

Yes. Accounts can be cancelled at any time. Keep in mind that earnings that are not used for qualified higher education expenses are subject to a 10 percent federal tax penalty (with certain exceptions for death, disability and scholarships), plus federal and state income taxes on the earnings reportable on the taxpayer’s return, and the recapture of any Virginia tax deduction previously taken on the amount of the cancellation or refund.

You have thirty years after the student’s projected high school graduation date, or thirty years from when the account was opened (if opened after the student’s high school graduation) for Invest529 and CollegeAmerica accounts. You have ten years after the student’s projected high school graduation date to use a Prepaid529 account. Virginia529, in its sole discretion, may grant extensions of time in which to use a Virginia529 account.

Account ownership can be transferred at any time to an individual 18 years of age or older and a U.S. citizen or legal U.S. resident. Account benefits can be transferred to a member of the current student’s family without penalty. Penalties may apply if transferred to an individual who is not a member of the current student’s family. Please read the applicable Program Descriptions and consult your tax adviser for more information.

Yes! Anyone may contribute to your Virginia529 account, but only account owners may take the Virginia state income tax deduction for contributions.

Accounts may grow tax-deferred and are tax-free of federal and Virginia taxes when withdrawals are used for Qualified Higher Education Expenses and at eligible institutions. Virginia taxpayers who are Virginia529 account owners can deduct their contributions up to $4,000 per account, per year, with unlimited carry forward to future tax years.

No state residency restrictions exist for Invest529 or CollegeAmerica. 

No. All of our accounts, including Prepaid529, can be used at any eligible educational institution around the country or the world, public or private! Benefits of Prepaid529 contracts differ depending on how and where they are used. Please see the applicable Program Descriptions for more information.

Yes. Many families choose to enroll in multiple Virginia529 programs. Account values across all programs may not exceed $550,000 per student.

Yes. Most vocational, technical, and graduate schools are eligible educational institutions. Check the eligibility of a specific school online at fafsa.ed.gov using the “School Code Search” or contact the school directly. Benefits of Prepaid529 contracts differ depending on how and where they are used. Please see the applicable Program Descriptions for more information.

Account owners must be 18 years of age or older and a U.S. citizen or legal U.S. resident to open an account, while the beneficiary must be a U.S. citizen or legal U.S. resident to be named to an account. The account owner may also be a U.S. trust, corporation, partnership, nonprofit organization, custodian, guardian or other entity. Only Prepaid529 requires the owner or the beneficiary to be a Virginia resident at the time the account is opened.

The update can take up to 30 days after the required documentation is received.  The new account owner will receive notification of the update via mail.

Please send a copy of the Account Owner’s death certificate and complete as much of the information on the  form as you know.

Virginia529 accounts automatically pass to the named designated survivor at the death of the Account Owner.  When a valid Designated Survivor is not named Virginia529 reserves the right to designate the account beneficiary (student) as the new account owner if the student is over the age of 18.  If the student is under the age of 18, Virginia529 has the discretion to set up a custodial account (under UTMA) for the benefit of the student and designate a custodian to manage the account until the student turns the age of 18.  Per the Prepaid529 and Invest529 Program Descriptions, Virginia529 may take the suggestion of the executor or representative of the deceased Account Owner’s estate when naming a custodian for a student. 

If both the Account Owner and Designated Survivor have passed away, complete and submit the Transfer Account Upon Death of an Account Owner Form, along with a copy of the death certificates.

Report Death of Account Owner

When an individual other than the account owner passes away, the account owner may change the individual on the account by completing the appropriate form and required documentation.

If the beneficiary (student) on the account passes away, the account owner may:

  • Change the student on the account by completing and submitting the Beneficiary Change Form.
  • Withdraw the funds, subject to federal income tax on the earnings and state income tax for Virginia taxpayers. Non-Qualified Withdrawals due to a student’s death will not be subject to the 10% federal penalty on earnings. It is up to the Account Owner to provide this documentation and talk to their tax advisor.

The update can take up to 30 days after the required documentation is received.  The new account owner will receive notification of the update via mail.

Please send a copy of the Account Owner’s death certificate and complete as much of the information on the  form as you know.

Virginia529 accounts automatically pass to the named designated survivor at the death of the Account Owner.  When a valid Designated Survivor is not named Virginia529 reserves the right to designate the account beneficiary (student) as the new account owner if the student is over the age of 18.  If the student is under the age of 18, Virginia529 has the discretion to set up a custodial account (under UTMA) for the benefit of the student and designate a custodian to manage the account until the student turns the age of 18.  Per the Prepaid529 and Invest529 Program Descriptions, Virginia529 may take the suggestion of the executor or representative of the deceased Account Owner’s estate when naming a custodian for a student. 

If both the Account Owner and Designated Survivor have passed away, complete and submit the Transfer Account Upon Death of an Account Owner Form, along with a copy of the death certificates.

Prepaid

Prepaid529 funds undergraduate in-state tuition and mandatory fees assessed to all students at Virginia public two- and four-year institutions. It does not cover room and board, books, supplies and other qualified higher education expenses. Prepaid529 also does not cover any additional charges of any type for specific courses of study, such as nursing or engineering, that an institution may require or for more than a normal full-time course load. Some families choose to save for these other costs with a Virginia529 savings account, such as Invest529 or CollegeAmerica, as a child may be the student of more than one Virginia529 account.

If the student stops attending school, immediately submit a Stop Benefits request. Stopping your Prepaid529 benefits is a convenient online process.

Follow the steps below to submit a request.

  1. Select View My Accounts, then Withdrawal History.
  2. In the Enrollment section, locate the appropriate student and school
  3. Click the Stop Benefits button.

Virginia529 will no longer make payments to the school once the request has been submitted and accepted. To begin using benefits again, the account owner should submit a new withdrawal request.

Prepaid529 permanently closed for new enrollment as of May 1, 2019. There will be no changes to existing Prepaid529 contracts, and current contracts will retain the Prepaid529 benefit structure in effect at the time of purchase.

Earnings grow free from state and federal taxes when used for qualified expenses. Taxpayers may deduct from individual Virginia taxable income contributions of up to $4,000 per account per year made to a Virginia529 account. If you contribute more than $4,000 to an account in one year, you may deduct up to $4,000 per year until you have claimed all of your contributions.

Virginia public institutions of higher education include a number of options, giving you a great deal of choice for using your Prepaid529 account. Find a list on the website of the State Council of Higher Education for Virginia (SCHEV) under “Virginia Public Colleges and Universities.” Note: you may use your Prepaid529 account toward tuition at schools listed under “Private & Out-of-State Institutions” on this page, however your benefit will be different and may not cover the full cost of tuition and mandatory fees.

No. Students can use Prepaid529 accounts at private Virginia colleges and universities and schools outside of Virginia, but the benefits differ.

At private colleges and universities in Virginia, Prepaid529 pays the lesser of the following:

  • Payments + actual rate of return on payments
    or
  • The highest Virginia public institution tuition and mandatory fees

At public or private colleges and universities outside Virginia, Prepaid529 pays the lesser of the following:

  • Payments + reasonable rate of return* on payments
    or
  • The average Virginia public institution tuition and mandatory fees

* This is determined by the Virginia529 Board and currently follows the quarterly performance of the Institutional Money Funds Index as reported in the Money Fund MonitorTM by iMoneyNet.

Prepaid529 should not affect a student’s eligibility for merit–based scholarships. If your child receives a scholarship, you have several options including:

  • Keeping the account to apply to future educational needs, such as graduate school
  • Rolling over a portion of the contract to an Invest529 account to be used for qualified expenses not covered by the scholarship
  • Transferring the account to a younger member of the family
  • Requesting a refund of an amount up to the value of the scholarship without penalty, although payment of taxes on the earnings may be required

529 accounts, including Prepaid529, may have an impact on financial aid offers from colleges and universities. In the calculation of a student’s Expected Family Contribution (EFC) for financial aid, 529 accounts with a parent or a dependent student listed as the account owner are assessed at a maximum of 5.65 percent of the account’s value, depending on other reportable household assets. 529 accounts owned by an independent student, a non–custodial parent or a third party (for instance a grandparent) are assessed at higher rates.

A Prepaid529 account must be used within 10 years of the date a student is projected to graduate from high school (also called Projected Enrollment Date).

If the student listed on your account served as an active-duty member of any branch of the United States Armed Forces after their high school graduation, that time will not be counted toward the 10-year period. For more information regarding extension requests, see the Prepaid529 Program Description and Master Agreement.

You can elect to continue to own and make payments to your Prepaid529 account. Your student may use their paid-in-full account at any eligible institution to which they applied and are accepted. However, if your child chooses to attend a Virginia public college or university and is no longer eligible for in-state tuition, Virginia529 will not pay the difference between the in-state and Non-Virginia resident rates.

No. You cannot change the student on your Prepaid529 account once it is in TN status.

A status of “TN” on your quarterly statement or online account indicates that more than 10 years have passed since the projected high school graduation date of the beneficiary (student) listed on your Prepaid529 account (also called Projected Enrollment Date). Per the Prepaid529 Program Description and Master Agreement, all Prepaid529 benefits must be exhausted by the tenth anniversary of the student’s projected graduation date.

Once your account reaches TN status, Virginia529 will close the Prepaid529 account approximately 30 days later and automatically transfer the funds into an Invest529 FDIC-Insured Portfolio account for you to use. If you do not have an FDIC-Insured Portfolio, one will be created for you. Account Owners will receive a notification via email and mail detailing this process.

Gifting

Family, friends, or anyone can give to an existing Virginia529 account.

The Gift ID is anonymous and is safe to be shared any way you want – in person, over the phone, through social media, etc.

Your personal Gift ID can be retrieved from the secure Virginia529 online account portal. Once logged in, select the Gift Center link in the main navigation. On the Gift Center home page, scroll down “Gift ID Information” and select the appropriate account (if more than one) and copy your Gift ID.

You could give up to the maximum allowable account balance across all Virginia529 programs, which is $550,000 per student.

Virginia529 doesn’t charge fees to the giver or the account owner for making contributions through the online Virginia529 Gift Center. However, Virginia529 and/or your financial institution may assess fees for rejected transactions or insufficient funds. Gift cards purchased at Target and H-E-B retail locations, and online at Walmart.com include a convenience fee to cover distribution and processing. The gift card fee is paid by the gift card purchaser and the gift recipient receives the gift card amount.

Gifts of up to $16,000 per year, or up to $32,000 if married, to any one person are gift tax free.

You should consult a professional concerning any financial, tax or legal implications related to making a gift contribution to a Virginia529 account. Virginia529 does not provide legal, financial or tax advice to any person making a gift.

U.S. citizens or legal U.S. residents age 18 or older may open a Virginia529 account for a student—family member, friend, or even yourself.

No. Anyone may contribute to a Virginia529 account as long as they have the account owner’s Gift ID.

Invest529

First, read about the programs Virginia529 offers, specifically the Program Description for the program(s) in which you are interested. After you have selected a program, select "Open an account" from the top of any page to gather the information you need to get started. After you create an online user profile, you can complete the application for Invest529. To open a CollegeAmerica account, contact your financial advisor or visit americanfunds.com.

Any non-retirement investment or savings account may affect eligibility. For accounts owned by parents and dependent students, the Free Application for Federal Student Aid (FAFSA) assesses 529 assets at a maximum of 5.64 percent of the value when calculating the Expected Family Contribution (EFC) for financial aid eligibility. Accounts owned by other parties will impact eligibility differently. For more information, consult studentaid.gov or an educational financial aid advisor.

You have thirty years after the student’s projected high school graduation date, or thirty years from when the account was opened (if opened after the student’s high school graduation) for Invest529 and CollegeAmerica accounts. You have ten years after the student’s projected high school graduation date to use a Prepaid529 account. Virginia529, in its sole discretion, may grant extensions of time in which to use a Virginia529 account.

Account ownership can be transferred at any time to an individual 18 years of age or older and a U.S. citizen or legal U.S. resident. Account benefits can be transferred to a member of the current student’s family without penalty. Penalties may apply if transferred to an individual who is not a member of the current student’s family. Please read the applicable Program Descriptions and consult your tax adviser for more information.

Invest529 Investment Options

An account owner may initiate an investment option change twice per calendar year per student. If there is a change in student, an investment option change can also be made at the same time.

Yes, an account owner may have multiple portfolios for the same student and each portfolio is a separate account. The account owner may not have two of the same portfolios for the same student. For instance, an account owner could not have two 2039 portfolios for the same student but could have a 2039 portfolio and an ESG Core Equity portfolio for that same student.

The only insured portfolio is the FDIC-Insured Portfolio and this portfolio is insured by the Federal Deposit Insurance Corporation (FDIC) to the fullest extent permitted by law. All other Invest529 portfolios are subject to market risk including loss of principal.

You may choose any of the Invest529 portfolios, however it's important to keep in mind the shorter the time horizon when the money will be needed for private, public, or religious K-12 schools when choosing a portfolio. There are Invest529 portfolios that have conservative and stable investment strategies as well as more aggressive options, but it is ultimately up to you to choose the portfolio that best meets your risk tolerance and time horizon.

Target Enrollment portfolios are designed for college savers. You pick the date your student will be graduating from high school and over time the investments go from more aggressive to more stable. 

For more information about Target Date Portfolios, view the blog article: Three Things to Know About: Target Enrollment Portfolios.

Tuition Track

Purchasing additional Tuition Track Portfolio Units is simple. Log in to your Virginia529 account and select “Manage My Accounts,” then “One-Time Contribution.” After you select the bank account you’d like to use for the contribution, you’ll be able to select your Tuition Track Portfolio account and the amount you’d like to contribute. Use the Tuition Track Calculator to determine how many additional units you’d like to purchase.

Every year Virginia529 will calculate the Average Tuition at Virginia public colleges and universities, weighted by enrollment. That number is divided by 100 to determine the cost of an individual Tuition Track Portfolio unit. For example, if the Average Tuition for the 2021-22 year was $15,000, the cost per unit would be $150. If the Average Tuition for the 2022-23 year was $20,000, the cost per unit would increase to $200 for new units. The value of previously purchased units will keep pace with Tuition growth.

Funds can be moved from the Tuition Track Portfolio to other Invest529 portfolios. The value depends on whether the Tuition Track Portfolio account has reached the Expected Usage Date and whether or not the funds have been held for three or more years.  

Tuition Track Portfolio units may be used for K-12 tuition.  However, the value will be based on whether the units being withdrawn have been held for at least three years and whether the account has reached the Expected Usage date. Tuition Track accounts are designed to be used for post-secondary education.

Yes, account owners can transfer units to younger and older siblings, and to the Members of the Family of the student within the same generation of the original student who are eligible at the time of the student change. The Expected Usage Date will change as the student changes.

Account owners who were Virginia residents when their account was opened can continue to purchase Tuition Track Portfolio units after they’ve left the state.

The Tuition Track Portfolio Unit Price adjusts annually on or around July 1. Account owners will receive advanced notice of the price changes.

Getting Started

Yes, an account owner can set up recurring contributions directly to a Virginia529 account from a linked bank account or use the Direct Deposit Assistant at myaccount.virginia529.com to have funds sent by their employer and contributed directly to a Virginia529 account. Employees should follow their internal process for establishing direct deposits.

Yes, this type of transfer is called a rollover. The account owner should first open an Invest529 account and then complete the Move Funds or Change Investment Portfolio process online, which authorizes Virginia529 to request the rollover from another 529 plan (also known as a qualified tuition program).

Funds may also be rolled over from Coverdell Education Savings accounts or Qualified U.S. Savings Bonds. See the Invest529 Program Description for more information.

An account can be opened with as little as $10. Subsequent contributions are not required, allowing you to save at your own pace.

No, however you can open an account and once the child is born update the student.

Yes, a Virginia529 account owner may select multiple portfolios, and each portfolio selected creates a separate account. Although a student can have multiple accounts, an account owner may not have two accounts in the same portfolio for the same student.

Account owners must be 18 years of age or older and a U.S. citizen or legal U.S. resident to open a Virginia529 account, while the student must be a U.S. citizen or legal U.S. resident. The account owner may also be a U.S. trust, corporation, partnership, nonprofit organization, custodian, guardian or other entity.

To open a Tuition Track Portfolio account, either the account owner or the student must be a resident of Virginia at the time the account is opened.

Using Your Account

Yes. Most vocational, technical, and graduate schools are eligible educational institutions. Check the eligibility of a specific school online at fafsa.ed.gov using the “School Code Search” or contact the school directly. 

It’s not required to report withdrawals used for qualified higher education expenses on your federal tax return. Virginia529 will issue an IRS Form 1099-Q (Qualified Tuition Program Payments) each year in which a withdrawal is made:

  • For withdrawals made payable to the student or a school, the 1099-Q is sent to the student.
  • For withdrawals made payable to the account owner, the 1099-Q is sent to the account owner.
  • Non-qualified withdrawals will incur a 10 percent penalty on the earnings portion of that non-qualified withdrawal and should be reported as income by the 1099-Q recipient.

The same qualified higher education expense may not qualify for more than one tax benefit  (e.g. tax-free withdrawals AND a federal tax credit). 

For more information, view the blog article 529 Plans and Your Tax Return, the 1099-Q Fact Sheet, or the Invest529 Withdrawal Guide.

If you are a Virginia taxpayer, non-qualified withdrawals may require the recapture of prior Virginia income tax deductions. If you live outside of Virginia, please check with your state’s tax department to determine your state’s treatment of income from another state’s qualified tuition program.

Find information about tax benefits for education including examples, in IRS Publication 970, also available by calling the IRS toll-free at 1-800-829-1040. Your tax consequences depend on your individual circumstances. You should consult a tax advisor regarding specific tax consequences of taking withdrawals from your Virginia529 account(s).

No, you will only receive a Form 1099-Q if you withdrew funds from or closed your Virginia529 account. Internal rollovers, investment option changes and transfers within Virginia529 will not generate a 1099-Q.

Account owners can access their Form 1099-Q in their online account at Virginia529.com.

If a withdrawal was made directly to a student or the student’s eligible educational institution, then the student will need to set up their online login at Virginia529.com to access their Form 1099-Q.

If funds were withdrawn from your Virginia529 account in 2022, tax documents providing the 2022 withdrawal information (IRS Form 1099-Q) will be posted online and mailed in January 2023.

  • If the withdrawal was paid directly to the student or to the student's eligible educational institution: the Form 1099-Q will be mailed to the student
  • If the withdrawal was paid directly to the account owner: the Form 1099-Q will be mailed to the account owner

To prevent delays in receiving your Form 1099-Q, you should log in to your Virginia529 account online at Virginia529.com and verify that your address and the student's address are up to date.

Any non-retirement investment or savings account may affect eligibility. For accounts owned by parents and dependent students, the Free Application for Federal Student Aid (FAFSA) assesses 529 assets at a maximum of 5.64 percent of the value when calculating the Expected Family Contribution (EFC) for financial aid eligibility. Accounts owned by other parties will impact eligibility differently. For more information, consult studentaid.gov or an educational financial aid advisor.

No. All of our accounts, including Prepaid529, can be used at any eligible educational institution around the country or the world, public or private! Benefits of Prepaid529 contracts differ depending on how and where they are used. Please see the applicable Program Descriptions for more information.

Move Funds

Yes, you may move funds from another qualified tuition program into a Virginia529 account by completing a Move Funds Request. If you do not already have an Invest529 account, you must open an Invest529 account before completing the request.

Funds may also be rolled over from Coverdell Education Savings accounts or Qualified U.S. Savings Bonds. See the Invest529 Program Description for more information.

Yes, you must liquidate the EE or I U.S. Savings Bonds and/or Education Savings Account and complete the Coverdell/US Savings Bond Transfer Form. Keep in mind, Virginia529 is not responsible for redeeming the EE or U.S. Savings Bonds or coordinating the Coverdell Account transfer with the originating financial institution. You must also provide Virginia529 with the basis and earnings for your redemption of qualified Series EE or I U.S. Savings Bonds or the transfer of a Coverdell Education Savings Account at the time these proceeds are deposited to your Virginia529 account. If the information is not received within 60 days, the entire amount will be recorded as earnings.

CollegeAmerica is available only through financial professionals. Generally, your statement will have “CollegeAmerica” listed in the account title or name.

  • You are allowed two investment option changes per beneficiary (student) per calendar year.
  • You are allowed one rollover per student during a rolling 12-month period.
  • There is no limit on the number of transfers.

Please read the applicable Program Description for more information.

It typically takes approximately three (3) business days to process requests submitted online to move funds between Virginia529 accounts (if mailing paper forms, the processing time may be longer). For rollovers involving another qualified tuition program (QTP), please allow up to 30 days for processing after all required documentation is received. Account owners should check with the other QTP’s administrator regarding their processing times.

You can upload your supporting documentation or signature pages through your online account. After logging in, select Upload Documents under the Help Desk tab. You may also upload the documents securely by using Virginia529’s Secure Upload Link.

An account owner may initiate an investment option change twice per calendar year per student. If there is a change in student, an investment option change can also be made at the same time.

Basics