529 qualified expenses
Last updated August 2026
Short answer
Getting this list wrong is expensive in one direction only. A non-qualified withdrawal taxes the earnings and adds 10% on top of them, while your contributions always return untouched.
Postsecondary costs
Tuition and mandatory fees at any institution eligible to participate in a Department of Education student aid program, which includes colleges, universities and many vocational schools.
Books, supplies and equipment required for courses, including a computer and related equipment and internet access used primarily by the student while enrolled.
Room and board, for students enrolled at least half time, capped at the school's published allowance in its cost of attendance. Off-campus rent counts up to that figure and no further.
K-12, and what changed
Elementary and secondary expenses are limited to $20,000 per year per beneficiary across all their plans, up from $10,000 before the end of 2025.
The categories are broader than tuition: curriculum and curricular materials, books and instructional materials, tutoring or educational classes outside the home, fees for nationally standardised achievement tests and advanced placement or admissions examinations, dual enrolment fees, and educational therapies for students with disabilities provided by a licensed or accredited practitioner.
The limit is per beneficiary rather than per account, so multiple plans for one child do not multiply it.
Apprenticeships, credentials and loans
Fees, books, supplies and equipment required to participate in an apprenticeship program registered and certified with the Secretary of Labor.
Certain qualified postsecondary credentialing expenses, which extends 529 money beyond degree programs into recognised certifications.
Student loan repayment of principal or interest, limited to $10,000 lifetime for any individual, with a separate $10,000 available for each sibling. Interest paid this way cannot also be claimed for the student loan interest deduction.
Try it in Walnut
Walnut connects to your brokerage accounts and analyses what you hold. A 529 usually sits with its state plan administrator rather than at a broker.
What does not qualify
Transportation and travel to and from school, however necessary it is in practice.
Health insurance, medical costs, and sports, club or activity fees that are not required for enrolment.
Any expense already covered by a tax-free scholarship, an education credit or another education benefit, since the same cost cannot support two tax advantages.
Timing and paperwork
Withdrawals should happen in the same calendar year as the expense, which catches families paying a spring semester bill in December.
Keep receipts. The plan reports distributions on Form 1099-Q and does not certify that they were qualified; that evidence is yours to hold.
Where a scholarship reduces costs, a withdrawal up to the scholarship amount escapes the 10% additional tax, though the earnings remain taxable.
Coordinating with education credits
The American Opportunity and Lifetime Learning credits cannot be claimed on the same dollars a tax-free 529 distribution paid for.
Families who qualify for a credit often pay some tuition out of pocket deliberately, to preserve the expenses the credit needs, and use the 529 for the rest.
Getting the order wrong wastes a credit worth more than the tax saved on the distribution, which is why the arithmetic is worth doing before the payment rather than after.
Sources
The qualified expense list, the $20,000 K-12 limit, apprenticeship and credentialing costs and the $10,000 loan repayment limit are from the IRS at Topic no. 313, with room and board and coordination rules in Publication 970. Walnut is informational and is not an investment adviser. This guide is educational and not personalized tax advice.
FAQ
What are qualified 529 expenses?
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Expenses required for enrolment or attendance at an eligible postsecondary institution: tuition, fees, books, supplies and required equipment, plus room and board within limits for students enrolled at least half time. Registered apprenticeship costs and certain credentialing expenses also qualify.
Can 529 money pay for K-12?
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Yes, up to $20,000 per year per beneficiary from all their plans combined. Since the end of 2025 the eligible list is broader than tuition alone, covering curriculum materials, books, outside tutoring, standardised test and AP fees, dual enrolment fees and certain educational therapies.
Can I repay student loans with it?
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Up to $10,000 lifetime for the beneficiary, and a separate $10,000 for each sibling. Interest paid with 529 money does not also qualify for the student loan interest deduction, so the same dollar cannot produce two benefits.
Is a computer a qualified expense?
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Yes, where the computer, peripheral equipment, software and internet access are used primarily by the beneficiary during their years of enrolment. General-purpose software and games are excluded.
Is room and board covered if my child lives off campus?
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Yes, but only up to the allowance the school includes in its published cost of attendance for off-campus students. Rent above that figure is not qualified, and the school's financial aid office publishes the number.
What is not covered?
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Transportation and travel, health insurance, sports and club fees not required for enrolment, and repayment of a loan already paid with 529 money. Those are the categories most often assumed to qualify and do not.
What happens if I withdraw more than the qualified expenses?
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The excess is prorated, and the earnings portion becomes taxable to the recipient plus a 10% additional tax. Your original contributions always come back untaxed, so the damage is limited to the growth.