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Kids are expensive these days and even more so when they go off to college. Luckily, we live in a country that rewards parents for helping to pay for their child’s education. Parents and grandparents experience several tax breaks when it comes to giving money to children to help pay for their education. Here are some tax-smart ways to help reap those benefits:

Contribute to a 529 plan. The money put away in a 529 plan can be used tax-free for college costs. Some states also allow you to receive a state income-tax break for your contributions. Be sure to create two separate accounts for each child or grandchild as tax deductions may only be given to the owner of the account.

Get a gift-tax break from 529s. Parents and grandparents can give up to $13,000 per person in one year without being subject to gift-tax rules. Additionally, you can make five years’ worth of 529 contributions in one year and still avoid the gift tax as long as you don’t give any other money throughout the five years.

Get a tax credit for tuition payments. If you spend at least $4,000 in tuition and qualified expenses each year for your child’s undergraduate education and your modified adjusted gross income is below $160,000 if married ($80,000 if single head of household), your tax bill can be cut by $2,500 per student.

Pay tuition directly to the college. Payments made directly to educational institutions are excluded from the $13,000 annual gift-tax limit. However, this only applies to tuition payments, not room and board.

Help your kids or grandkids contribute to a Roth IRA. Kids can start up a Roth IRA as long as they have some sort of earned income. Although they won’t receive any tax benefits from contributing to one, they will be financially secure in the future.

Open a custodial account for the kids. This is a great way to teach your kids about investing. Make the investing decisions together until your child gains control over the account.

For more information on ways to help your kids benefit financially, visit Kiplinger.