An email recently appeared in my inbox that mentioned college education plans that can help pay for kindergarten through high school, ahead of college. As a mom of two school-age kids, I was curious to learn more. So, I asked lawyer and tax expert Mary Morris to clear up some of the details about the 529 Education Savings Plan. Her answers may interest many Texas families.

What is a 529 Education Savings Plan?

A 529 plan is a tax-advantaged savings account for higher education expenses. Earnings in 529 accounts grow tax-free from state and federal taxes and are never taxed when used for qualified education expenses.

In 1996, Congress enacted Section 529 of the Internal Revenue Code, establishing federal tax rules for 529 plans, which allow families to save in advance for the costs associated with higher education.

While 529 plans were originally designed with college use in mind, in 2017, Congress approved the expansion of the qualified education expenses to include certain public, private or religious K-12 tuition expenses. Withdrawals of up to $10,000 per beneficiary (student) per year for tuition may be taken as a qualified expense from a 529 plan. 

Can it be used in elementary school through high school as well as college?

Yes! Withdrawals from a 529 account of up to $10,000 per student per year for tuition are considered a qualified education expense. The costs of textbooks, room and board, supplies and other expenses for K-12 education, however, are not covered.

If you wait until college to use these funds, can they only be used to pay for school tuition, or can a 529 plan help with other costs related to education?

529 accounts can be used at public and private colleges and universities worldwide, including community colleges, as well as for technical, continuing education and advanced degree programs. Qualified education expenses include tuition, fees, books, computers and related technology, and some room and board costs for students attending an eligible college or university.

Tuition is the only approved qualified education expense when used for K-12 education.

Can anyone sign up for this or do you have to meet certain requirements? 

529 plans are for learners of all ages, whether that be a child attending a private K-12 school, a teen preparing for college, or adults returning to school to upgrade their career skills.

Are there age limits or income limits for applying?

Whether your child was just born or has just started high school, there’s no time like the present to put away money for education. The sooner you start, the more time your investment will have to grow.

Can only parents apply for a savings plan, or can someone else apply for one for my child?

Anyone can open a 529 plan for a child, although only the account owner will receive the tax benefits if the account is in a state with state-level benefits. To open an account, an individual must be 18 years of age or older and a U.S. citizen or legal U.S. resident. The student must also be a U.S. citizen or legal U.S. resident. The account owner may also be a U.S. trust, corporation, partnership, nonprofit organization, custodian, guardian or other entity.

What if you save now but don’t end up needing the funds after all, or you find yourself needing the funds for a non-education related, emergency expense?

You will never lose control of your money! The money put into the account is always yours. If plans change, withdraw the money and you’ll only pay taxes on the interest earned. Earnings that are not used for qualified education expenses, however, are subject to a 10% federal tax penalty (with certain exceptions for death, disability and scholarships).

Is this different from the Texas College Savings Plan? If so, can you apply for both?

The Texas College Savings Plan is also a 529 plan, and yes, individuals may participate in either or both plans. In general, families should look first to their state plan to see if there are tax or other advantages that are available to you if you participate in your state’s program. Because Texas does not have a state income tax, they do not offer what many states do, which is a state income tax deduction for contributions.  All 529 accounts and programs grow free of state and federal income taxes – but contributions are after-tax contributions. 

Texas does have two types of programs. The Texas College Savings Plan is a savings program, and the Texas Tuition Promise Fund is a

prepaid tuition program that has certain defined benefits from participation. Not every state offers these types of programs. Texans should explore all their options to make an informed decision on which program is right for them. 

To learn more, visit

Mary Morris, CEO of Virginia 529, brings decades of experience as an authority with expertise in timely issues including higher education, education finances and disability savings. 

Annette Lucksinger is a mom of two, editor of Austin Family magazine and author of “Exploring Austin with Kids.”

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