Qualified Education Expenses

Q: What are considered qualified education expenses?

A: Qualified education expenses include (1) qualified elementary and secondary education expenses, and (2) qualified higher education expenses. Qualified education expenses also include any contribution to a qualified tuition program on behalf of the designated beneficiary.

Q: What are qualified elementary and secondary education expenses?

A: Qualified elementary and secondary education expenses include expenses for:

• Tuition, fees, academic tutoring, special needs services in the case of a special needs beneficiary, books, supplies, and other equipment incurred in connection with the enrollment or attendance of the designated beneficiary as an elementary or secondary school student at a public, private, or religious school. (School means any school that provides elementary or secondary education [kindergarten through grade 12] as determined under state law).
• Room and board, uniforms, transportation, and supplementary items and services (including extended-day programs) that are required or provided by a public, private, or religious school in connection with enrollment or attendance.
• Expenses for the purchase of any computer technology or equipment, or to pay for Internet access and related services, are considered qualified education expenses if such technology, equipment, or services are to be used by the beneficiary and the beneficiary's family during any of the years the beneficiary is in school (not including expenses for computer software designed for sports, games, or hobbies unless the software is predominantly educational in nature).

Q: What are qualified higher education expenses?

A: Qualified higher education expenses include expenses for:

• Tuition, fees, special needs services in the case of a special needs beneficiary, books, supplies, and equipment required for the enrollment or attendance of the designated beneficiary at an eligible educational institution.
• The cost of room and board is a qualified education expense if the designated beneficiary is at least a half-time student* at an eligible educational institution. The expense for room and board is generally limited to:
  • The school's posted room and board charge for students living on campus, or
  • $2,500 each year for students living off campus and not at home.

* A half-time student is enrolled "at least half-time" if he or she is enrolled for at least half the full-time academic work load for the course of study the student is pursuing as determined under the standards of the school where the student is enrolled.

Q: What is an eligible educational institution for purposes of qualified higher education expenses?

A: An eligible educational institution is any college, university, vocational school, or other postsecondary educational institution eligible to participate in the student aid programs administered by the Department of Education. This category includes virtually all accredited public, nonprofit, and proprietary postsecondary institutions. (These same eligibility requirements for institutions apply for the Hope Scholarship Credit, the Lifetime Learning Credit, and early withdrawals from IRAs for qualified higher education expenses). The educational institution should be able to tell you if it is an eligible educational institution.