529 Eligible Expenses: What Can a 529 Be Used For?

Wondering what a 529 can be used for? While 529 accounts are commonly associated with college tuition, they actually can be used for a broad range of education expenses, including K-12 tuition, apprenticeship programs, student loan repayment, and more. Ahead, we'll explore which expenses qualify for tax-free withdrawal using 529 funds—and which expenses don't. 

529 accounts cover most basic costs for students. These are the most common expenses that typically qualify for tax-free withdrawals. 

• Tuition at public, private and religious colleges, and universities.
• Schools must participate in federal student aid programs.
• Certain vocational schools, nondegree and post-secondary credential programs.
• International schools approved by the U.S. Department of Education may also qualify.

• Covered for students who attend at least half time at an eligible educational institution.
• This includes on-campus housing and student meal plans.
• For students living off campus, rent and food (including groceries) are eligible expenses, so long as they do not exceed the school's cost-of-attendance allowance.

• Required textbooks and course materials.
• Computers, laptops, and tablets used primarily for education.
• Internet access and required software used primarily by the student.

• Testing fees for standardized tests, such as admission or Advanced Placement exams.
• Costs for dual enrollment in college courses.
• Tutoring and educational therapy to students with disabilities or special needs (when required by the institution).

• Tuition expenses for public, private, and religious elementary or secondary schools.
• Limited to $20,000 per student per calendar year under federal rules in 2026 (up from $10,000 in 2025).
• Applies only to tuition; other K–12 expenses typically do not qualify.
• State tax treatment may vary depending on the plan.

• Programs must be registered and certified with the Department of Labor.
• Eligible expenses can include tools and equipment, required materials, textbooks, fees and tuition, specialized training courses, computer software, and digital subscriptions.

• Beneficiaries can use 529 funds to repay qualified education loans, up to a $10,000 lifetime limit per beneficiary.
• Student loan interest paid by any portion of the $10,000 as a tax-free withdrawal cannot be deducted for federal taxes.

• 529 funds can be used for a broad range of workforce training programs, professional credentials, and continuing education costs.
• Federal guidelines allow broad use, but individual state guidelines may vary.
• Always check your 529 plan description and state 529 tax guidelines before making 529 withdrawals for professional development.

• Airfare, gas, parking, and commuting costs.
• Transportation to school, training programs such as internships, or other educational activities such as field trips.
• Travel expenses for both K–12 and higher education.

• Student health insurance premiums.
• Medical, dental, or vision expenses.
• Exception: If the university requires all students to have health insurance and charges premiums directly as a condition of enrollment, those premiums may be eligible. 

• Activity fees and costs associated with student clubs, sports teams, and organizations.
• Membership dues for sororities and fraternities' membership dues.
• Gym memberships, entertainment, and recreational activities.

• Childcare, daycare, and babysitting services.
• Care provided while attending classes or studying.
• Nanny services or other dependent care services.

• Personal expenses such as clothing, laundry, and personal care items.
• Non-required supplies and equipment, including optional electronics.

If you use 529 funds for a non-qualified purpose, only the earnings portion of the withdrawal is subject to taxes and penalties: 

• Federal taxes and penalty: Earnings are taxed as regular income, plus there's a 10% tax penalty from the IRS.
• State income tax rules: If your home state gave you a tax deduction or tax credit for contributions, you may need to repay those benefits when making a non-qualified withdrawal.
• Penalty exceptions: The 10% penalty is waived if the beneficiary gets a tax-free scholarship or fellowship grant, attends a U.S. military academy, becomes disabled, or passes away. Income tax on earnings still applies.

If your student doesn't use all the funds or skips college entirely, you still have options.

You can name a new beneficiary. The new beneficiary can be almost any family member (including yourself).

You may be able to roll over up to $35,000 from a 529 account into a beneficiary's Roth IRA if 1) the account has been opened for 15 years or more and 2) the beneficiary has earned income up to the amount converted. Rollovers also count toward the annual Roth IRA contribution limits. Make sure to review the most current IRS rules before making any beneficiary changes.

Understanding which expenses qualify for 529 account withdrawals can help you maximize the tax benefits of your education savings while avoiding unexpected taxes or penalties. Because eligibility rules can vary by state and by plan, it's important to review your specific 529 plan details before taking a distribution—especially for expenses beyond traditional college tuition and fees.

Using 529 funds may also have implications for financial aid or state tax benefits, depending on how the account is structured and how withdrawals are taken. If you're unsure whether a planned expense qualifies, or how a withdrawal might affect your broader financial picture, consider reviewing your options with a financial or tax advisor.