![]() ![]() The funds you accumulate in a 529 plan can be used to pay the full amount of your tuition and fees for: These expenses are usually considered qualified education expenses for 529 plan funds, with a few exceptions. It’s worth noting the rules for some of these expenses are a bit more complicated than others. Here is a list of common educational expenses and their qualification status: The definition of qualified higher education expenses (for 529 plan purposes) also includes up to $10,000 per year in tuition for K-12 schools and up to $10,000 in student loan repayments. Qualified higher education expenses include costs required for the enrollment or attendance at a college, university or other eligible post-secondary educational institution. Families may also be eligible for a state income tax deduction or credit for 529 plan contributions, depending on where they live (more on that in a minute, though). Money invested in a 529 college savings plan grows tax-deferred, and qualified distributions are tax-free. Let’s get started! What you can pay for with a 529 planįirst off, let’s dive into the qualified expenses of a 529 plan. What are 529 eligible expenses, and how do you ensure you abide by 529 account rules? Today, we’ll cover an updated list of qualified education expenses, examples of non-qualified expenses, and what to do if you spend funds on a non-qualified expense. However, there are many 529 plan rules, specifically for 529 qualified expenses. Contributing to a 529 plan offers tax advantages when the money in the account is used for qualified education expenses. A 529 plan is a powerful tool that parents and family members can use to save for a child’s education. ![]()
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