Roth IRA

Effective January 1, 2024, qualified “leftover” AZ529 account funds may be transferred to a Roth IRA free of any tax, penalty or applicable income limits. So, your tax-free 529 withdrawals of funds invested can begin as early as kindergarten for the designated beneficiary and can continue even beyond graduate school to their Roth IRA in retirement!

The transfer or distribution from the 529 account must occur after December 31, 2023. The 529 account also must have been maintained for a minimum of 15 years, with the same owner and same designated beneficiary. The amount being transferred must also have been contributed at least five years prior to such transfer and the aggregate lifetime limit that can be rolled over is $35,000.