(Since I put my foot into this, might as well put my cards on the table) My kiddo gets a tax form with her social security $$$ listed on it at the end of each year. She pays no tax on it. It is not considered part of my income. The money is paid to me and I decide how it will be spent. I’ve put the majority of it in a 529 in both our names. If it was just a regular savings account, all that money would become “hers” when she was either 18 or graduated high school.(or whichever comes last/first???) I would have no control over what she did to the money. That’s partially why I got permission (years ago) to put it into a 529. That way the money could only be used for college, sort of.
My completely amateur opinion is that if that money went into a 529 before Jan1, it would be cool by the IRS. Some how, I think if the financial year ticks over with it in a checking account, maybe it will be seen as fair game by the FA people. I wish I knew the answer to that