From the IRS:

Earnings are not subject to federal tax and generally not subject to state tax when used for the qualified education expenses of the designated beneficiary, such as tuition, fees, books, as well as room and board. Contributions to a 529 plan, however, are not deductible.

Some off-the-beaten-path 529 uses:

Study Abroad

The bulk of the expense of studying abroad is eligible for 529 use if the program qualifies.  This specifically does not include airfare or healthcare but DOES include tuition, fees and room and board.  I had never considered this as an option, but considering the huge tax advantage of a 529 plan, this merits consideration, particularly if you have children that don’t need it or don’t have children.

Personally, I’d consider this for postgraduate training if permissible or for a language study course.  It’d be an extended tax-free vacation.


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