529 Room And Board Off Campus

If the cost of room and board exceeds the student budget s allowance for room and board any excess above the allowance will be considered a non qualified distribution if 529 plan money is used to pay for it.

529 room and board off campus. Your room and board 529 reimbursement is limited to the greater of the school s room and board allowance or the actual amount the student would pay for on campus housing. Many people prefer off campus apartments and need to cover that as much as they would on campus rent. Funds from 529 plans can pay for on campus housing but off campus housing may not always be an eligible expense. Yes the cost of off campus room and board may be a qualified education expense for 529 plans if certain criteria are met.

As an example let s say that for 2019 2020 the off campus coa is room 10 000 and board 5000. Irs pub 970 states. As long as the student is enrolled at least half time the irs will approve room. Another stipulation is that the student must be enrolled at least half time for off campus housing costs to be considered a qualified distribution.

Room and board whether you live on campus or off you can use your 529 plan spending for your room and board expenses. A student does not have live on campus or in college approved housing for room and board to qualify as an education expense. Paying for on campus housing if the student is living on campus and using a meal plan paying for room and board with a 529 plan is easy as most plans have an option to send a check directly to the school. His school publishes off campus cost of attendance numbers for room and board separately as opposed to a lump sum number.

The caveat here is that your off campus housing costs can t be higher than you d pay to live on campus if you want to use 529 funds. The average room and board for students who live off campus is slightly lower. My son is a full time student living off campus. If a student meets the eligibility criteria the account owner can use the 529 plan to pay for both on campus and off campus housing expenses.