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A 529 plan is a tax-advantaged account that can be used to pay for qualified education expenses, including college, K–12, and apprenticeship programs.
529 plans provide tax-free investment growth and withdrawals for qualified education expenses, but it's important to know and follow the plan rules for distributions.
Making a 529 withdrawal is simple. There is no annual limit on how much you can withdraw in a given year for higher education. Learn more about the rules that apply to 529 withdrawals.
When you pay qualified education expenses from a 529 account, your withdrawals are federal-income-tax- and penalty-free. As of 2019, qualified expenses include tuition expenses for elementary, middle, and high schools (private, public, or religious).
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.
A 529 plan is a college savings plan sponsored by a state or state agency. Savings can be used for tuition, books, and other qualified expenses at most accredited colleges and universities.
New rules for 529 college savings plans have gone into effect for 2024. While funding a 529 plan has long been a great way for families to contribute to save for college in a tax-advantaged way, recent rule changes have expanded the benefits and made 529 plans even more attractive.