If my wife’s grandparents opened and funded 529 accounts for our kids but the grandparents died, whose property is it the kids’ or their mother’s?

Now we are divorced. I say its the kids money and not my ex-wife’s contribution. She says its her money. Who is correct?

Asked on November 3, 2017 under Family Law, New York

Answers:

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

And I believe that you would be correct.  NY 529 plans have - on the Beneficiaries section of their website - the following information under the accounts of an individual:
The beneficiary is the future student. You may edit the beneficiary's contact information online. To update a beneficiary's name, birth date, citizenship, or SSN, please call Client Services for instructions.
Now, there is a section that allows you to name a Successor to control the account in the event of your death.  That may be your wife.  But it is not her money. However, if she is controlling it then there could be hanky panky since you can in fact withdraw funds for more than just tuition.  Go on the website to look.  Good luck.


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