529 Accounts Are Not Your Divorce Piggybank
“Unilaterally withdrawing funds from 529 accounts to pay for non-education related expenses while a divorce action is pending is a risk not worth taking.”
January 10, 2025 at 11:00 AM
5 minute read
Matrimonial law is derived from judicial decisions (i.e., “caselaw”) and statutes. As well intentioned and precise as those statutes and the caselaw interpreting them, are and can be, the fact remains that how matrimonial courts apply the law is by and large case specific.
This is a long-winded way of saying that because each matrimonial case tends to depend upon its own unique set of facts, courts are often compelled to reexamine and reevaluate the legislative intent underlying the statutory framework otherwise known as the Domestic Relations Law (the “DRL”).
That brings us to Justice Edmund M. Dane’s recent decision in LKF v. MTF, 2024 NY Slip OP 24312 (Sup. Ct., Nassau Cty. 12/9/2024), which addresses the “novel issue” of “how to classify a 529 account under the Automatic Orders” and “whether or not a party’s post-commencement withdrawal of money from a 529 account to pay their own counsel fees violates” the Automatic Orders.
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