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* Maximum contribution of a 529 plan is around $55,000 per beneficiary. This is in any 5-year period to avoid federal gift tax. In comparison to 529 plan, maximum contribution in a Custodial account is $11,000 per year per beneficiary. This is again to avoid federal gift tax.
* The tax imposed on earnings in a 529 college saving plan is kept aside to be paid later. In other words 529 plans are tax-deferred. In comparison to 529 plans, earnings in a custodial account are taxable at the parent's income tax rates.
* 529 college saving plans are federally tax-free for qualified expenses. On the other hand in a custodial account the sale of the assets are liable to capital gains which are to be paid by the custodian or beneficiary.