I don’t know where you are getting this information that a 529 would be reported as a student asset.
It would actually be a more rare situation for a student to own a 529 account. Typically they are set up as follows: “With an individual 529 plan, the owner is usually a parent or other adult who saves money on behalf of a chosen beneficiary, typically their child. The account owner makes contributions, makes investment decisions and also has the power to change the beneficiary as they see fit.”
A 529 can be set up as custodial account: “In a custodial 529 plan arrangement, the student is both the owner and the beneficiary. But when the student is a minor, an adult custodian must manage the account on their behalf.
This custodian can be a parent, grandparent or legal guardian. The custodian’s job is to manage the funds in the 529 plan on behalf of the beneficiary until they reach adulthood. In most states, that means age 18, though in some states the age threshold may be higher.
The custodian can’t change the beneficiary or account owner. Once the account owner/beneficiary becomes an adult, they assume control over the 529 plan.”
Quotes above from: 529 Plans: Custodial vs. Individual - SmartAsset | SmartAsset
Typically, 529 plans are set up in the first way and the parent is the owner. The CSS Profile treats these as parental-owned assets.
I have experience with custodial 529 accounts too though…… and these are also treated as a parental asset, even after the student reaches the age of majority (and the account is under the student’s control with the student as the beneficiary). This “loophole” is a special case that only applies to Section 529 accounts and not to assets in other dispositions.
Here’s direct information about these in terms of FAFSA treatment of them. “Assets in a custodial 529 plan account owned by a dependent student are reported as parent assets on the student’s FAFSA. Generally, custodial 529 plans owned by a student’s sibling are not reported on the student’s FAFSA, since the sibling is the owner of the custodial 529 plan account. However, the CSS Profile requires students to report any assets owned by a sibling under age 19 and not yet in college, including 529 plans.”
I have confirmed this with multiple FA offices at multiple CSS Profile institutions in the past two years that they treat custodial 529 accounts the same way.