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My wife and I are maxing out my 3-year old daughter's state 529 plan this month. She will then be fully vested. My question is this. Can my parents contribute to an Educational IRA for her this year? Could we then contribute to this Educational IRA the following years? They are now getting more attractive ($2,000 vice $500). Our state 529 only covers 5 years of tuition at the state run universities. We bear any other costs such as room and board or the difference in private school tuition which I know the Educational IRA can pay for. Any rules on tapping 529's and ED IRA's in the same year? I know we may not be able to claim her tuition on our taxes. That's fine as the tax free growth and use of 529 money will be well worth it. Any thoughts or references would be greatly appreciated. This will allow my wife and I to now start planning our vacations when our daughter is in school.

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