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Old 08-18-2008, 01:41 PM
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Section 529 Qualified Higher Educational Expenses

My son attends the University of Texas at Austin. I have a Section 529 educational account set up for him. I understand that I can draw out (tax free) an amount equal to his actual tuition, books, fees, supplies, etc. However, with respect to room and board, he lives off campus. The regs say that the amount for room and board that qualifies as higher education expenses shall not exceed the cost of attendance (COA) as determined by the educational institution.

UT publishes an estimated COA that includes a figure for "Off Campus Room and Board." It also includes figures for "Transportation" and "Personal/Miscellaneous." My question is this - do the amounts shown as transportation and personal/miscellaneous qualify as higher education expenses, or am I limited to the room and board number they provide?

Any help would be appreciated. Thanks.



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Old 08-24-2008, 09:48 AM
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The current rules for the "529 Plans" specifically allow the distributions from the plan for Qualified Education Expenses. These so called "qualified education expenses" include the following:

1. expenses required for the designated beneficiary's enrollment in and attendance at an eligible school.

2. tuition and fees.

3. books, supplies and equipment.

4. academic tutoring.

5. room and board.

6. uniforms.

7. transportation.

8. expenses of a special needs beneficiary that are necessary for that person's enrollment or attendance at an eligible educational institution.

Thus, any distributions for any of the above qualified expenses will result in the non-taxability of the distributions. Thus, any gains from the earnings from the 529 Plans will not result in any tax liability.

The Transportation expenses are listed as Item number 7 and thus in your case this item would be a qualified item and thus there is no tax liability from any distributions from the 529 Plans used to pay for these expenses (assuming of course they were incurred for your child;s transportation resulting from travel to and from college).

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Old 04-30-2009, 04:11 PM
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Uniforms, Transportation, & Tutoring

In your reply on qualified expenses for a 529 plan you stated the following:

The current rules for the "529 Plans" specifically allow the distributions from the plan for Qualified Education Expenses. These so called "qualified education expenses" include the following:

1. expenses required for the designated beneficiary's enrollment in and attendance at an eligible school.

2. tuition and fees.

3. books, supplies and equipment.

4. academic tutoring.

5. room and board.

6. uniforms.

7. transportation.


I read the rules and do not see #'s 4, 6, and 7. I assume my info is dated or there are new rules that apply? Where can I find these? Thanks!



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