Updated July 31, 2026. Quick answer: the beneficiary must have earned income at least equal to the rollover amount, in the rollover year — wages, self-employment, the things that would support an IRA contribution. Investment income, allowances and gifts do not count. A $7,500 rollover needs $7,500 of the kid’s own W-2 or Schedule C income that year.
What this means for real families
The rollover cannot start before the paychecks do. A 529 for a 14-year-old with no job rolls nothing, regardless of account age — which is fine, because the 15-year clock is usually the later constraint anyway. Part-time income works: a college junior earning $6,000 lifeguarding supports a $6,000 rollover — and those low-income student years are ideal, since the beneficiary is unlikely to be using the limit on her own contributions. The income does not have to be saved: she can spend every paycheck; the 529 supplies the dollars. That is the quiet magic here — it converts a teenager’s spent summer wages into funded Roth space, which is otherwise impossible.
Plan the full multi-year sequence: the rollover calculator.
Summer jobs now fund retirement space later. Sequence it.
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